postcards: taking gains ahead of OPEC, the ticking time-bomb of debt, and future productivity losses...
The U.S. government is about to drop money out of the sky to try to avoid a recession. The problem is that our debt situation has worsened for everyone (except our government officials).
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Friday, June 2, 2023
Dear Old Friend,
Luzern, Switzerland, is a fascinating place.
But not as fascinating as the mathematics behind American debt ceiling accounting.
You’re waking up this morning to the Senate passing a debt ceiling deal with few voices standing up to the absurdities of it all.
We plan to add another $4 trillion in new debt by 2025, and the debt ceiling is suspended past the next election. The incentives to spend into oblivion before the election are massive. The government might spend enough money to prevent an official recession, but D.C. again ignored voters’ demands for spending cuts. The money printer is back, while productive parts of the economy are shattered.
Sure, the U.S. avoided default – but another problem looms that could fuel more debt and higher service costs.
The nation must refinance about half its debt within 30 months. Les…
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