About once a year, I do a forecast of the debt. I arbitrarily set a limit of 150% of debt to GDP, and see that this will be exceeded in 2043. This is better than last year's danger signal of 2041. We can see that it is theoretically still possible to slow this ship before it crashes. This is because the GDP numbers look much better than last year's forecasts, although this is primarily due to inflation. Also, my interest forecasts may be too high.
I am not trying to be pessimistic, only realistic. It does seem like my worst case scenario could be avoided. To do this requires increasing GDP - to grow our way out the debt. This would need increases of 3%+ plus on average, not adjusted for inflation. Also keep the primary deficit under 3% of GDP and keep average net interest costs under 3%. Lots of 3s there. Maybe this sucker isn't going down - to paraphrase W.
No comments:
Post a Comment