Fiat printing and sovereign debt is going to accelerate in the next 10 years in several ways:
Demographics are brutal.
- More retirees drawing benefits
- Fewer workers paying into the system
- Exploding healthcare costs
- All while the tax base shrinks
Interest rates are the killer.
- Interest payments are consuming more of government budgets
- Refinancing old cheap debt at higher rates
- Creates a doom loop: higher rates → higher payments → more debt → higher rates
- The Fed trapped between inflation and destroying the bond market.
Unfunded liabilities
- Pension obligations
- Social security shortfalls
- Medicare/healthcare promises
- Most governments can't possibly make good on all promises
Politicians can't help but make it worse
- No politician wins by cutting benefits
- Money printing is the path of least resistance
- Each crisis leads to more intervention and more spending
It's not about "IF" but "WHEN" these bubbles pop.
The system requires exponential debt growth just to maintain itself making the current trajectory totally unsustainable.
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