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Wednesday, July 8, 2020

IMF is warning about the debt crisis now!

https://www.reuters.com/article/us-health-coronavirus-debt/many-countries-may-need-debt-restructuring-after-pandemic-fallout-imf-chief-economist-idUSKBN2482R3

It makes sense to restructure the debts in many countries because high debts are unsustainable over the long term.

The USA has about US$80T total debts now with a GDP of US$21T.  Therefore, the ratio of debt to GDP is 4:1.

http://sg-stock.blogspot.com/2020/04/the-us-economy-will-be-in-deep-troubles.html

http://sg-stock.blogspot.com/2020/05/the-us-economy-will-be-in-deep-troubles.html

This means that the USA is using US$4 debt to generate a US$1 GDP which is unsustainable in the long run.


2 comments:

Eric Ho said...

Now you know that the US will never be able to repay all its debts because it can only afford to repay 25% at most.

Eric Ho said...

http://sg-stock.blogspot.com/2019/08/does-us-2-10y-inverted-yield-curve.html

We did warn about the US debt growth in 2019.