Concerns about the increasing U.S. debt are causing a stir on Wall Street, but economist Paul Krugman remains unfazed and advises others to do the same.
In a recent op-ed for The New York Times, the Nobel laureate pointed out that while the $34 trillion debt is a record high, the debt-to-GDP ratio is comparable to post-World War II levels and significantly lower than Japan’s current debt burden and the U.K.’s postwar debt, both of which did not lead to a debt crisis.
Krugman highlighted that most historical debt crises occurred in countries that borrowed in foreign currencies.
Although U.S. debt has been on the rise for years, concerns have been raised about the continuous accumulation of debt even outside of emergency situations like the pandemic, without a major global crisis like World War II.
Investors are becoming increasingly wary of the future trajectory of deficits and debt in the upcoming decades.
2024-06-08 15:43:54
Originally posted on finance.yahoo.com