The New CS Board

[jumanji0881]

Interest on the debt is a huge threat : https://www.msn.com/en-us/news/politics/interest-on-the-debt-is-a-huge-threat/ar-AAXIrRq?ocid=msedgntp&cvid=d08b44ee38d54ff2aa7bea74f257dd3c

My Comment: No one seems concerned about the debt and it has not been a problem as government spending continues unabated despite Biden's claim of having reduced this year's fiscal deficit by $1.5Trillion (We'll see if that holds true in September). So, when does this debt begin to affect the economy and the markets ?

Excerpts:
Between 2019-2021, annual interest on the debt averaged $389 billion, an increase of $117 billion, or 43 percent. The president’s fiscal year 2022 budget, which is the first to project deficits of more than $1 trillion for 10 consecutive years, estimates that FY 2022 interest on debt of $26.3 trillion will be $305 billion and reach $941 billion in FY 2031, or more than triple the amount for the current fiscal year. By that time, interest payments will account for 59 percent of the projected $1.6 trillion deficit.

The projected interest payments in the budget were made with the assumption that 10-year Treasury interest rates would be 1.4 percent in FY 2022, then average 2.2 percent for the next four years and average 2.8 percent for the following five years. But the 10-year Treasury interest rate is already 2.8 percent and likely to go higher given the Federal Reserve Bank’s plan to continue raising interest rates.

An increase in interest rates of one percentage point above projected rates, according to Brian Reidl of the Manhattan Institute, would raise interest payments by $30 trillion through 2051, and at that time the payments would be equal to 70 percent of all tax revenue. An increase of two percentage points would mean that interest payments would equal 100 percent of all tax revenue in 2051.