With U.S. federal debt at 100.1% of GDP, the highest since World War II and rising, investors often wonder what the breaking point could be of mounting U.S. debt. The critical consideration to examine is not actually the level of debt or the ratio of debt to GDP, but rather the cost of servicing the debt. The chart on the left shows national debt soaring (gray), but the interest rate paid on that debt coming down sharply in recent decades (light blue).
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