Wave of Debt Payments Facing U.S Government

by James & Miel on November 23, 2009 · 0 comments

This story is making the rounds on Digg. Its a sobering look at the national debt from the NY Times. In a nutshell its saying the debt is becoming increasing difficult to manage – total annual interest payments are approximately 500 billion. For my part, I’m thinking the Treasury is acting like a debt junky who is in denial about their spending.

Treasury officials now face a trifecta of headaches: a mountain of new debt, a balloon of short-term borrowings that come due in the months ahead, and interest rates that are sure to climb back to normal as soon as the Federal Reserve decides that the emergency has passed.

Even as Treasury officials are racing to lock in today’s low rates by exchanging short-term borrowings for long-term bonds, the government faces a payment shock similar to those that sent legions of overstretched homeowners into default on their mortgages.

With the national debt now topping $12 trillion, the White House estimates that the government’s tab for servicing the debt will exceed $700 billion a year in 2019, up from $202 billion this year, even if annual budget deficits shrink drastically. Other forecasters say the figure could be much higher.

Click here for the full story.



Like DINKS? Subscribe!


Subscribe to get the latest DINKS Finance content by email.

Powered by ConvertKit

{ 0 comments… add one now }

Leave a Comment

This blog is kept spam free by WP-SpamFree.

Previous post:

Next post: