Genuine Risk For A U.S. Bond Collapse
2025-06-24 08:20:00 ET
The US debt-to-GDP ratio is currently at 123% and is projected to reach 140% by 2029. Annual deficits now equal 6.4% of GDP, and the Congressional Budget Office forecasts that the deficit will rise to 9% of GDP, or $2.7 trillion, by 2035. The interest payments on US debt alone account for approximately 3% of the country's GDP. Even if the primary deficit were eliminated, the debt-to-GDP ratio would not fall unless the underlying economic growth exceeded 3%. However, this is highly unlikely, as both the labor force and productivity are shrinking, with productivity down 1.5% in the first quarter. Achieving consistent 3% growth is, therefore, impossible....
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Genuine Risk For A U.S. Bond Collapse
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