Interest payments on the US public debt

[All Along The Watchtower]

http://www.usgovernmentspending.com/spending_chart_2010_2011USp_13s1li011mcn_90s90l90f

Interest on the debt is approaching 2.5%. The same site states that a default becomes likely when interest on the debt is equal to around 12% of GDP.

[Wonkish1]

http://www.usgovernmentspending.com/spending_chart_2010_2011USp_13s1li011mcn_90s90l90f

Interest on the debt is approaching 2.5%. The same site states that a default becomes likely when interest on the debt is equal to around 12% of GDP.

Well Pompous when people took out a mortgage with a 1% teaser rate in 2004 their interest payments were quite low to, but as we can see that can change pretty quickly.

Also that isn't the best indicator.

Look at debt service as a percentage of GDP. Look at debt service as a percentage of revenue. Look at public debt as a multiple of revenue.

You want to look at the expert on sovereign balance sheets its Professor Rogoff. He is a Keynesian, but he isn't dogmatic like Krugman and is just really good at gathering research so he has my respect.

[Beet]

http://www.usgovernmentspending.com/spending_chart_2010_2011USp_13s1li011mcn_90s90l90f

Interest on the debt is approaching 2.5%. The same site states that a default becomes likely when interest on the debt is equal to around 12% of GDP.

The US does not face the same problems as Europe because the Federal Reserve is willing to support US bond prices and lend to the US government. That is why no country outside the euro zone has this problem of sovereign debt crisis.

The US's risk is balance of payments crisis, which is foreigners stop sending capital to the US and start sending capital out. The US's ability to withstand this is not based on interest as a percentage of GDP or revenue, but the US's trade deficit.

[Wonkish1]

http://www.usgovernmentspending.com/spending_chart_2010_2011USp_13s1li011mcn_90s90l90f

Interest on the debt is approaching 2.5%. The same site states that a default becomes likely when interest on the debt is equal to around 12% of GDP.

The US does not face the same problems as Europe because the Federal Reserve is willing to support US bond prices and lend to the US government. That is why no country outside the euro zone has this problem of sovereign debt crisis.

The US's risk is balance of payments crisis, which is foreigners stop sending capital to the US and start sending capital out. The US's ability to withstand this is not based on interest as a percentage of GDP or revenue, but the US's trade deficit.

Really? Iceland, Hungary, and Japan just name a few. But compared to the rest of the world our financial position is amazingly better.

[Beet]

http://www.usgovernmentspending.com/spending_chart_2010_2011USp_13s1li011mcn_90s90l90f

Interest on the debt is approaching 2.5%. The same site states that a default becomes likely when interest on the debt is equal to around 12% of GDP.

The US does not face the same problems as Europe because the Federal Reserve is willing to support US bond prices and lend to the US government. That is why no country outside the euro zone has this problem of sovereign debt crisis.

The US's risk is balance of payments crisis, which is foreigners stop sending capital to the US and start sending capital out. The US's ability to withstand this is not based on interest as a percentage of GDP or revenue, but the US's trade deficit.

Really? Iceland, Hungary, and Japan just name a few. But compared to the rest of the world our financial position is amazingly better.

Those countries dont have sovereign debt crisis right now.

[Wonkish1]

http://www.usgovernmentspending.com/spending_chart_2010_2011USp_13s1li011mcn_90s90l90f

Interest on the debt is approaching 2.5%. The same site states that a default becomes likely when interest on the debt is equal to around 12% of GDP.

The US does not face the same problems as Europe because the Federal Reserve is willing to support US bond prices and lend to the US government. That is why no country outside the euro zone has this problem of sovereign debt crisis.

The US's risk is balance of payments crisis, which is foreigners stop sending capital to the US and start sending capital out. The US's ability to withstand this is not based on interest as a percentage of GDP or revenue, but the US's trade deficit.

Really? Iceland, Hungary, and Japan just name a few. But compared to the rest of the world our financial position is amazingly better.

Those countries dont have sovereign debt crisis right now.

Well Iceland did and got bailed out. They are going to now have another one. But the nature of sovereign debt crisis's is that they follow the pecking order of the nuances of their system. If somebody thinks for example that Japan wouldn't have a sovereign debt crisis in less than 4 years even without the Eurozone problem I have some swamp land to sell them. I mean the situation there is even more dire than Greece it just hasn't materialized and come to a head yet.

[opebo]

The US needs to be printing at least that 2.5% of GDP in new fiat currency every year - if not more - to try to fight the deflation which besets us.