Saturday, August 06, 2011

Debt Addiction: US borrowing tops 100% of GDP

I forgot to post this earlier.

The floodgates for borrowing has opened.

From Yahoo,

US debt shot up $238 billion to reach 100 percent of gross domestic project after the government's debt ceiling was lifted, Treasury figures showed Wednesday.

Treasury borrowing jumped Tuesday, the data showed, immediately after President Barack Obama signed into law an increase in the debt ceiling as the country's spending commitments reached a breaking point and it threatened to default on its debt.

The new borrowing took total public debt to $14.58 trillion, over end-2010 GDP of $14.53 trillion, and putting it in a league with highly indebted countries like Italy and Belgium.

Public debt subject to the official debt limit -- a slightly tighter definition -- was $14.53 trillion as of the end of Tuesday, rising from the previous official cap of $14.29 trillion a day earlier.

Treasury had used extraordinary measures to hold under the $14.29 trillion cap since reaching it on May 16, while politicians battled over it and over addressing the country's bloating deficit.

The official limit was hiked $400 billion on Tuesday and will be increased in stages over the next 18 months.

Here are some noteworthy debt charts

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From the Economist

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From Britannica

Addiction to acquiring debt has not been limited by political party.

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Outside Japan JP and Belgium BE, the US approaches the debt levels of today’s crisis stricken nations of Portugal PT, Italy IT and Greece GR (chart from Deutsche Bank)

What is unsustainable won’t last.

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