This is alarmist linkbait that fails to provide any context.
The follow plot shows interest as a percent of GDP -- that is, in relation to the size of the economy, which is how we should all look at this:
The follow plot shows interest as a percent of GDP -- that is, in relation to the size of the economy, which is how we should all look at this:
The USD as world reserve currency is the biggest sword the US has.
At current rates or higher we just piss off every country as they trade in eurodollars. They have started the process and will move off USD unless we get back to a favorable rate for their debt loads.
With our debt load, it's either lower rates and continue to print and inflation (traditional and/or more asset bubbles). Or elevate rates and boost our interest expense and suppress the economy while fighting inflation until entities quit buying our debt and we lose significant power. And then, we still need our money printer and more inflation occurs.
As for me, I'm going with keeping recent "elevated" rates so big banks can scoop up smaller ones in short term and inflation has some check, then back to lower rates after election. I'll hold inflation hedging assets indefinitely.
US is screwed financially. Still better than most economies, but still screwed. Unfunded liabilities, AI, wage gap, education and housing costs, populism, political divide, geopolitical battles. There is no thesis that is great for the US unfortunately. It's best pitch is other countries are just as screwed or more.
There is no way out of the debt load. All solutions require printing like crazy. Or defaulting but you cannot give up the world reserve currency and the fallout would be catastrophic.
https://fred.stlouisfed.org/series/GFDGDPA188S
I think this is the first year in history that the interest payment was greater than the amount we spend on defense and we have exceeded WWII spending as a percentage of GDP in 2020 and on.
https://www.cbsnews.com/news/federal-debt-interest-payments-...
Of course more government spending is a cause of inflation too, which hasn't been very comfortable lately.
https://smartasset.com/financial-advisor/how-increased-gover...
It might be alarmist, it might not, we don't really know where the point of collapse is in regard to debt; we're in unprecedented territory.
It seems silly to count money that moves from one pocket to another within the Federal government.
Fed and government are separate entities. That debt can't disappear because "we owe to our-self".
For example, in NYC there were 386 homicides last year, more than one per day! What a hazardous hellhole!
But the in population context (per 100,000) shows that NYC is one of the safest US cities big or small.
And in historical context (compared with the prior year or with decades ago), and you'll see it's not only very safe, it's safer than it used to be.