Now that the Federal Reserve is on a path of monetary tightening—a blend of raising interest rates and reducing the $9 trillion balance sheet—the nation’s fiscal situation is coming under a microscope.
The U.S. government’s debt recently topped $30 trillion, increasing the country’s debt-to-GDP ratio to nearly 130 percent. U.S. government debt is now about one-third larger than its pre-pandemic level. Projections show that the national debt could exceed $41 trillion by 2030.
American consumers are not doing any better than Washington, the data show. Household debt—comprising home mortgages, auto loans, credit card balances, and student loans—is close to $16 trillion.
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