USA Inc. Revisited: A Basic Summary of America's Financial Statements (BOND)

Summary

• US public debt to GDP rose to 97% in 2023 from 39% in 2008.p.3
• Since 2008, public debt as a percentage of GDP rose 148%, while effective interest rates fell 64% to historically low levels.p.3
• Since then, interest rates have risen 59%, driving up the effective cost of debt.p.3
• The US money supply grew 167% over 15 years (2023 vs. 2008).p.4
• US public debt is up 600%+ over 25 years, while interest expense payments are down to 11% of spending (vs. 15%).p.5
• Had effective interest rates remained at 6.25%, net interest payments would have been 149% (~$1 Trillion) higher in F2023, versus the current 2.5% effective rate.p.6

Key insights

1. The authors say the state of the country's finances has profoundly deteriorated over the last 14 years.p.2
2. Net interest payments would have been nearly $1 trillion higher had effective interest rates stayed at their longer-term average.p.2
3. The 10-year US Treasury yield fell from 6.8% to 0.5% peak-to-trough between 2000 and 2020.p.5
4. Money supply growth has outpaced GDP growth, which the authors call unsustainable.p.4
5. Growth and inefficiency in public spending, especially entitlements and interest expense, appear unsustainable.p.2
6. The report updates the summary section of the authors' 2011 report using about 2023 actuals.p.7