Let’s define what a broke man is!
What’s considered broke to me is someone having a large amount of debt and cannot make the payments. You’re behind the eight ball, you’re stressed out with every decision you’re making – you’re making it from a place of panic, right? And when the man of the household keeps making desperate decisions, guess who pays the biggest price? The kids of that father making all of those bad financial decisions.
Let’s get right into it. America is in debt, $31 and a half trillion dollars. Uncle Sam is the poorest man in the world. But here’s the kicker – do you know what the biggest interest payment ever made by America in its history? Q4 of 2022.
FUN FACTS:
- This is the first time where interest payment is at $213 billion dollars
- Previous quarter of 2023 was the first time we paid $180 billion dollars, 4 quarters in a row; biggest interest payment we have ever paid in the history of America
- Problem with that: In 2020, the interest we were paying on our 29 trillion was 0.5%
- In 2021 its was 0.1%
- In 2022, it was around 1.9%
- In 2023, we’re going to be between four and a half to 6% of the debt we would have to pay
- This will be the first year in the history of America where we’re going to be paying trillion dollars in interest for our loan
Shown on the chart:
- Our debt to G ratio is the highest ever at 124%. America has never been here before – not even after World War 2
- From 1942-1988 our national debt was between four and a half trillion and 6 trillion. For 46 years, we kept it around the four and a half to 6 trillion
- America kept getting into debt, spending, spending, spending and spending. And now these interest payments are going to go
- With the way they are raising rates, don’t be surprised if 12 months from now, our interest is at $1.5 trillion in 2023
Countries with the most national debt
- United States – 124%
- United Kingdom – 8.7%
- France – 7%
- Germany – 6.46%
- Japan – 4.36%
- China – 2.6%
- Italy – 2.5%
- Spain – 2.26%
- Canada – 3%
- Australia – 1.83
Back in the days, President Reagan used to say to Republicans 4th of July is equivalent to Democrats, April 15th, Tax Day. But today, both parties are spending money. This is not a left or right thing. We are the 12th highest country in the world of debt to GDP ratio. This is not a good leader’s bulletin to be on.
My recommendation? If I were looking at this and how it relates to us as individuals and companies – whether it’s a company, individual or country, pump the brakes on spending. Let’s figure out ways to increase GDP and then let’s try to keep this thing flat and cut it down a little bit. And these interest rates can be scarier this year with the way these rates climb up. and then by incresing this and this year, then we invest.
Just like individuals, just like countries, just like companies – we have to pump the brakes on spending and figure out a way through innovation to increase G D P or else the debt payment this year could be $1-1.5 trillion and that’s going to be a scary sight.
FaceTime or Ask Patrick any questions on https://minnect.com/
Recommended video:
The Next Big Economic Crisis – UNEMPLOYMENT: https://www.youtube.com/watch?v=5xSyg5xDPBY(201)
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