https://sputnikglobe.com/20240108/34-trillion-national-debt-makes-us-a-boiling-frog-jpmorgan-warns-1116057995.html

$34-Trillion National Debt Makes US 'Boiling Frog', JPMorgan Warns

$34-Trillion National Debt Makes US 'Boiling Frog', JPMorgan Warns

Sputnik International

According to Congressional Budget Office estimates, by the early 2030s US expenditure on entitlements, mandatory initiatives and debt obligations could surpass its total revenue, pushing it closer to a financial cliff-edge.

2024-01-08T17:57+0000

2024-01-08T17:57+0000

2024-01-09T10:51+0000

economy

congressional budget office (cbo)

business

us

congress

us debt

us budget

us economy

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US finance giant JPMorgan has likened the us economy to a slow-boiled frog thanks to its $34-trillion national debt.The 2024 outlook from the New York-based firm evoked the popular myth that a frog will calmly in a pan of gradually-heated water until it is cooked alive — but would hop out if thrown into already boiling water.As the US government’s debt portfolio keeps swelling unabatedly, hitting an unprecedented $34-trillion mark, economists' concerns amplify urgent calls for intervention.Predictions from the Congressional Budget Office paint a bleak picture, suggesting that by the early 2030s the US will spend more on entitlements, mandatory programs and debt interest than it earns in revenue."The problem for the US is the starting point; every round of fiscal stimulus brings the US one step closer to debt unsustainability," JPMorgan strategist Michael Cembalest said.He noted the market's apparent tolerance for deteriorating government finances, stressing that could shift at any moment.Anticipating potential market and rating agency pressures, Cembalest said he expected significant reforms, possibly including new 'wealth taxes'. Despite the looming fiscal cliff-edge, substantial cuts in discretionary spending seem unlikely given the ongoing arguments in Congress over the federal budget.The JPMorgan analyst warned of a potential economic downturn last year, continuing into 2024, due to aggressive central bank interest rate hikes.

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2024

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us debt crisis, federal reserve rate hikes, federal reserve rate cuts, "boiling frog" situation, us debt profile, us $34 trillion debt burden.