Then how in the hell can we ever expect to return to this rate with current US debt sitting at 21 trillion (from what I just read, as of late Oct. that count is closer to 21.6 trillion)?
Is it just me or are current debt levels only sustainable because of record low interest rates? At 2.00% interest, annual interest repayments on debt sits at 420 billion. At 7.00% that number rises dramatically to almost 1.5 trillion.
Da fuq?
With the fed controlling interest rates they'll never allow that to happen (unless of course they've understated the effects of what QT might do) but the point remains...does this mean interest rates can effectively never return to their historical average, or anywhere near them for that matter?
In a slightly related topic, can anyone explain how the US government serviced debt in the 1980's with record high interest rates? I'm having trouble googling it!
Edit: I made a fairly glaring mistake. "Only" 15.8 trillion of the national debt is held by the public, the rest is money the government owes itself. That's still interest payments of 316 at current rates vs 1.1 trillion at 7.00%. At 5% it's still almost 800 billion.
Submitted November 03, 2018 at 05:27PM by itsmyst https://ift.tt/2qrhc5d
