Gregory Mannarino, 4/7/24
"Markets, A Look Ahead:
We Are In A Debt Death Spiral"
Global debt is now 336% of GDP.
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"US Facing ‘Death Spiral’ Of Swelling Debt"
by RT
Only a “miracle” can reverse the problem,
the renowned economist believes.
"The burgeoning US debt pile is akin to a “death spiral” that only a “miracle” could extract the country from, economist and 'Black Swan' author Nassim Taleb said, as quoted by Bloomberg. Taleb defined the expanding US debt load as a “white swan,” meaning a risk event that is highly predictable and more probable than a “black swan” event, a metaphor describing an occurrence that comes as a complete surprise.
“So long as you have Congress keep extending the debt limit and doing deals because they’re afraid of the consequences of doing the right thing, that’s the political structure of the political system, eventually you’re going to have a debt spiral,” Taleb said. “And a debt spiral is like a death spiral.”
US Treasury Secretary Janet Yellen has said that the absolute level of US public debt looks like “a scary number.” US government federal debt is now $34,633 trillion.* It now amounts to about $102,000 for an average American family of three. In 2023 alone, it grew by more than $4 trillion.
According to Taleb, a former trader who is best known for publishing several bestselling books on economics, white swans include both the US deficit and the American economy that has grown more vulnerable to shocks than in previous years. He called such vulnerability a feature of globalization, as problems in one region can ricochet around the world.
When asked how the US “debt spiral” could play out, Taleb said, “we need something to come in from the outside, or maybe some kind of miracle,” adding that this makes him “kind of gloomy about the entire political system in the Western world.”
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