(Bloomberg) — US government debt could reach 250% of gross domestic product without putting upward pressure on interest rates, according to a paper presented at the Federal Reserve’s Jackson Hole conference.
“Until fiscal consolidation occurs, there will be a race between the rising asset demand of an older population and the rising debt issuance needed to finance the associated increase in government expenditures,” said its authors — Adrien Auclert of Stanford University, Hannes Malmberg of the University of Minnesota, Matthew Rognlie of Northwestern University and Ludwig Straub of Harvard University.
“Without large adjustments, the supply of debt will eventually outrun demand, forcing interest rates to rise,” they said in the paper. “In our baseline, it is possible to push long-run debt to 250% of GDP without raising interest rates.”
The One Big Beautiful Bill Act passed by a Republican-controlled Congress in July has fueled debate over the importance of rising debt levels and their potential impact on borrowing costs. US government debt held by the public amounted to about 97% of GDP at the end of 2024.
The Congressional Budget Office, in projections issued in January, said it expected the debt-to-GDP ratio to rise to 117% by the end of 2034. After the law was passed, the CBO estimated the legislation would boost that number by an additional 9.5 percentage points.
In the paper, presented by Straub on Saturday at the Fed’s annual gathering of global central bankers in Jackson Hole, Wyoming, the authors took a longer view.
“Our calculations suggest that, in 2100, the US could sustain a debt-to-GDP ratio of 250% at the same interest rates as today. However, achieving this requires a fiscal adjustment of 10% of GDP or more,” they said. “The longer this adjustment is delayed, the more government debt supply outstrips its demand, eventually making government debt unsustainable.”
©2025 Bloomberg L.P.
Here’s another interesting video for you to watch. This goes into greater detail regarding the enemy and who they really are. You won’t hear it anywhere else, or not in the organized churches. They think everyone is the same and God is all love…..
WHITE EUROPEANS VS CAIN- EDOM/ESAU; WORLD CENTRAL BANKING JEWRY
https://odysee.com/@Arcodeaus:f/WHITE-EUROPEANS-VS-EDOM-ESAU-JEWRY-July-8,-2017
The story starts at the 3:50 mark. He begins to discuss the Cain element around the 11:30 mark.
A very interesting listen. I came across this and it sounds similar to what I have been saying.
ACH SHOW – DR. JAMES P. WICKSTROM – THE BOOKS
https://odysee.com/@Arcodeaus:f/ACH-SHOW—DR.-JAMES-P.-WICKSTROM—THE-BOOKS-(2)
My wife bought me a t-shirt off Amazon. I have yet to wear it, but I thought it was interesting, nonetheless.
“That’s What I Do, I Fix Stuff And I Know Things”
I do know a lot of things. I know a lot about Economics and how not to have to work for other people, nor run a business with profane customers.
I escaped the Universal deception almost 25 years ago, after I couldn’t reconcile what I read in the written word with what the organized churches were professing. I spend much more time studying the written word now than anything else. It’s just so fascinating to see how over 2 billion Christians have been deceived. Satan does deceive the whole world.
I fix stuff and I know things. Currently, I’m sleeping on an air mattress in my newest house. When I get home, I have a honey-do list of things to fix. Because, that’s what I do.
I pray to YHVH at least a few times a day. And I pray that my Father is as good to my people as he has been to me.
The Fed is starting to worry about the housing market now
While markets focused on the Federal Reserve’s monetary policy, minutes from the central bank’s last meeting revealed concern among some policymakers about the housing market, which has been raising alarms on Wall Street as a slowdown drags on. Fresh data also pointed to more worrying signs, especially in new homes.
Wall Street was laser-focused on the Federal Reserve’s monetary policy this past week, but minutes from the central bank’s last meeting revealed concern among some policymakers about the housing market.
As the sector’s slump drags on, it has triggered more alarm bells because activity in housing, such as residential investment and construction, has often served as a leading indicator on the overall economy.
Minutes from the Fed’s earlier meetings didn’t include such concerns. But that changed during the July 29-30 gathering.
“Participants observed that growth of economic activity slowed in the first half of the year, driven in large part by slower consumption growth and a decline in residential investment,” the minutes, which were released on Wednesday, said.
To be sure, housing was just one of several concerns that policymakers raised. Others included the labor market, the effect of tariffs on inflation, real income growth, elevated asset valuations, and low crop prices.
But Fed officials were also specific about their housing market worries, suggesting they were starting to pay more attention to the data.
“A few participants noted a weakening in housing demand, with increased availability of homes for sale and falling house prices,” the minutes said.
And not only did housing show up on the Fed’s radar, policymakers flagged it as a potential risk to jobs, along with artificial intelligence technology.
“In addition to tariff-induced risks, potential downside risks to employment mentioned by participants included a possible tightening of financial conditions due to a rise in risk premiums, a more substantial deterioration in the housing market, and the risk that the increased use of AI in the workplace may lower employment,” the minutes added.
Housing market data
The fact that the housing market is emerging as a worry at the Fed means that it could also weigh more on rate decisions, which influence mortgage rates.
In his Jackson Hole speech on Friday, Chairman Jerome Powell opened the door to a rate cut at the central bank’s meeting in September after months of maintaining a more hawkish stance, stoking a furious rally on Wall Street and sending the 10-year Treasury yield down sharply.
But in the meantime, fresh data show that the housing market remains stuck as elevated borrowing costs have kept would-be buyers on the sidelines.
Sales of existing homes rose in July but have largely been flat for most of the year, even as the number of listings has climbed, suggesting demand is weak. That’s suppressed home prices, with a gauge of median prices falling in all but one month this year.
“Weekly data suggests home prices may remain subdued in coming months, close to flat on the year or rising only very modestly,” analysts at Citi Research wrote on Thursday. “Home price declines are rare outside of hiking cycles or recessions.”
In addition, construction of new single-family homes remains lethargic, and data for July showed that building permits have declined in six out of seven months this year. In fact, permits—a volatile but leading indicator of future activity—fell to the lowest level since 2019, excluding the pandemic.
That was reflected in the NAHB homebuilder confidence index, which fell in August to reverse a modest uptick earlier. It also showed that the share of homebuilders offering sales incentives hit a post-pandemic high.
“As housing demand remains weak with high mortgage rates and high home prices, we expect further softening in housing activity this year,” Citi said in a separate note on Tuesday.