55% of the US National Debt Is the Result of Repaying Debt with More Debt

Re:55% of the US National Debt Is the Result of Repaying Deb... by _bxg1 on Thursday July 19, 2018 @10:10AM (#17566397)

I was much more sad when I initially thought this was talking about the debts of individuals.

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Re:55% of the US National Debt Is the Result of Repaying Deb... by readhn on Thursday July 19, 2018 @10:13AM (#17566424)

Consumer debt is at all time high as well.

https://www.newyorkfed.org/microeconomics/hhdc.html

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Re:55% of the US National Debt Is the Result of Repaying Deb... by damptowel on Thursday July 19, 2018 @01:34PM (#17568624)

Private sector debt is at the highest level in recorded history. This is why the post 2008 recovery was so sluggish, since on average every unit of currency circulated has to pay for a fraction of the debt servicing cost. If it stops doing this a crisis will occur, which will either be contractionary or bubble financed by creating new debt to finance old debt. The national authority, with it’s monopoly on coercion can use it’s power to declare debts null and void (this happens all throughout history), create new currency free of debt (pure credit) and spend it into the economy. It can also create an artificial hyperinflation to reduce debt burdens, instate a new currency region altogether (money is simply legal tender subject to the laws the state dictates for it), etc

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Re:55% of the US National Debt Is the Result of Repaying Deb... by seanmcdirmid on Thursday July 19, 2018 @10:14AM (#17566433)

With inflation, GDP growth, and population growth, that is generally true at any time.

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Re:55% of the US National Debt Is the Result of Repaying Deb... by graedus on Thursday July 19, 2018 @10:31AM (#17566620)

I briefly searched for inflation-adjusted debt per capita but couldn't find it.

There is the federal debt to GDP ratio, which is 105%. This is at least a 50-year high[0]. FRED's household debt to GDP data doesn't go back very far, but we can see it's off the highs off 2008[1]. (edit: added household debt to GDP)

[0] https://fred.stlouisfed.org/series/gfdegdq188S

[1] https://fred.stlouisfed.org/series/HDTGPDUSQ163N

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Re:55% of the US National Debt Is the Result of Repaying Deb... by JumpCrisscross on Thursday July 19, 2018 @10:37AM (#17566671)

> I briefly searched for inflation-adjusted debt per capita but couldn't find it

You're looking for household debt to GDP [1]. It is a real (versus nominal) statistic because it's a ratio between two nominal terms. It also communicates financial health better than a per-capita term, since it measures against production.

[1] https://fred.stlouisfed.org/series/HDTGPDUSQ163N

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Re:55% of the US National Debt Is the Result of Repaying Deb... by graedus on Thursday July 19, 2018 @10:56AM (#17566862)

I managed to find that - thanks!

A few other interesting angles: Household Debt Service Payments as a Percent of Disposable Personal Income[0] (10.3%, near 40-year lows), Consumer Debt Service Payments as a Percent of Disposable Personal Income[1] (5.9%, near 40-year average), Personal Saving Rate[2] (3.2%, near 50-year lows).

[0] https://fred.stlouisfed.org/series/TDSP

[1] https://fred.stlouisfed.org/series/CDSP

[2] https://fred.stlouisfed.org/series/PSAVERT

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Re:55% of the US National Debt Is the Result of Repaying Deb... by readhn on Friday July 20, 2018 @07:56AM (#17574246)

Part of the problem might be that it became harder for folks to obtain debt (mortgages specifically).

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Re:55% of the US National Debt Is the Result of Repaying Deb... by readhn on Thursday July 19, 2018 @10:14AM (#17566436)

https://ycharts.com/indicators/us_total_debt

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