GDP is now $29.7 trillion

 Earlier today, I posted my unhappiness with the BEA not telling us the actual GDP in trillions.   It turns out that they didn't mention it because they didn't think it was important, but I found the actual number.  Go to their announcement, now do a search on "key source data and assumptions", which is hyperlinked, and click on it to download a spreadsheet called "https://www.bea.gov/sites/default/files/2025-01/gdpkeysource-4q24-adv.xlsx".  Open it, and go to the Advance tab.  On the line that says "Gross Domestic Product", under the column "2024Q4", it is listed as 29,700.6.

So the ratio of Debt to the Public ($28.8 trillion) divided by GDP ($29.7 trillion) is 97%.  This is almost the same as one year ago with Debt to the Public of $27.0 trillion divided by GDP of $27.9 trillion to get 96.8%.  The debt and GDP both went up $1.8 trillion.

Even Progressives Now Worry About the Federal Debt

 https://dnyuz.com/2025/01/30/even-progressives-now-worry-about-the-federal-debt/

The main concern, says Danny Yagan, an economist at the University of California, Berkeley, is a tipping point that forces a sudden and catastrophic adjustment.  He cites a 1998 paper that likened the deficit not to a long term drag on growth — such as a termite infestation that gradually erodes the foundations of a house — but rather to a risky gamble, like not buying home insurance. If the fiscal house catches fire, perhaps because investors lose confidence in the government’s ability to pay back its debt, the options are not good: They include defaulting, forcing banks to hold more Treasuries, running inflation high so the debt recedes, or cramming down spending, all of which could cause a recession.  The reason that gamble looks increasingly risky is that large deficits could be starting to push up interest rates (“r” in economics lingo) while growth (“g”) remains steady. The Congressional Budget Office forecasts that debt will continue to increase, which forces higher interest payments, creating an upward spiral.  “Under C.B.O.’s projections, that’s going to slowly increase r relative to g until about 2040, when r is greater than g, and then debt starts to explode on its own,” said Dr. Yagan, who served in the Biden administration’s Office of Management and Budget and co-founded the Budget Lab at Yale. “That’s what people are worried about.”

BEA says that GDP increased but doesn't say how much

 Read: https://www.bea.gov/news/2025/gross-domestic-product-4th-quarter-and-year-2024-advance-estimate

"Real gross domestic product (GDP) increased at an annual rate of 2.3 percent in the fourth quarter of 2024".

Pardon my French, but this is BS.  It is meaningless.  The press release doesn't say what GDP actually is.  I did a search on the word "trillion", but it isn't in there.  Compare that to the previous release, which states "Current dollar GDP increased 4.7 percent at an annual rate, or $333.2 billion, in the third quarter to a level of $29.35 trillion."  Also this: "Current dollar GDP increased 5.0 percent at an annual rate, or $358.2 billion, in the third quarter to a level of $29.37 trillion, an upward revision of $20.6 billion from the previous estimate".

First, they are using mind tricks with Real GDP vs Current GDP, based on what they think inflation is.  Then they say Real GDP increased 2.3% and Current GDP increased 4.5% but this is an annual rate and not a quarterly rate.  Are they saying  that current GDP increased by 1.125% in the quarter (4.5% divided by 4)?  

I am not happy with the obfuscation.  So until they straight up tell me what Current Dollar GDP is, I am using the previous number, $29.37 trillion. 

Why is this important?  Because they use debt as a percent of GDP and justify rising debt because the percent of GDP doesn't increase very much.  So lets look at the current situation as of December 31 for 2023 and 2024.

As of December 31, 2023, Debt to the Public is $27.0 trillion and GDP was $27.9 trillion for a Debt to GDP ration of 97%.

As of December 31, 2024 Debt to the  Public is $28.837 trillion (rounded to $28.8 trillion) and GDP was $29.4 trillion (rounded) for a ratio of 98%.  So the ratio went up by 1%, which is not good news but its not horrible news.  

The BEA will release a second estimate of 4th Quarter GDP in about a month.

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I am trying to not post as much, so I will say a few more things in my now less frequent post.  First, I predicted on December 18 that the Fed would cut rates on Jan 28, 2025 and they didn't, so I was wrong.  It was freaky how much the Fed followed a 17 year pattern, but maybe the pattern has been broken.  Or maybe they will still cut rates in a month or two, and the 17 year pattern is just extended slightly.  I previously predicted a recession to begin on February 1, 2025, but maybe this will be delayed a few months.

Second, I just want to mention the Federal Reserve Deficit.  It was $210.97 billion as of 11/27/24, and $216.6 billion as of 1/1/2025.  And then as of 1/29/25 the number is $221.1 billion.  So it is increasing about $5 billion per month.  As I mentioned before, this is free money for billionaires. And part of the reason there is this deficit is because of the 3% mortgages that are still out there. 

Third, I think there are some similarities between 2023 and 2025.  On 12/30/22, the public debt was $24.5 trillion, and it increased to about $24.6 trillion by the end of January 2023, and then it pretty much froze there until about June 1, 2023 when the debt ceiling was lifted. It hit the $25 trillion mark on 6/10/23, and then quickly hit $26 trillion on 8/31/23.   

Right now, the Debt to the Public is still about $28.85 trillion, and it will probably remain there until about June 1.  I think we will not see $29 trillion public debt until June 2025, and then $30 trillion within a few months.  After that, if there is a recession, then we can expect this to rise a trillion every 90 days.

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Update:  I am still upset that BEA is playing games with the actual numbers, but I do know how to calculate.  On 1/30/2024, they said that Current dollar GDP is $27.94 trillion. On yesterday's press release, they said that current dollar GDP increased at a 4.5% rate, which would make it $29.2 trillion. In the above calculation I used $29.4 trillion, so I will stick with that until I am further enlightened.

While I am on the topic, if the government hypothetically decided to do a stimulus program of $1 trillion (for easy math), and that all went into GDP and that amount was borrowed, it would increase both the numerator and denominator.  If the numerator is greater than the denominator, then the ratio would actually decrease.  For example, current total national debt is about $36.2 trillion and GDP is $29.4 trillion.  The ratio is 123%.  If both of these numbers went up by $1 trillion then the ratio would drop to 122%.  So the cure for more spending is ... more spending.  What if the reverse happened, Elon finds $1 trillion of wasteful government spending (not too hard to find), so GDP drops $1 trillion (but the national debt would not decrease), so $36.2 trillion divided by $28.4 trillion is 127%.  So if you live in their world of lying with statistics, government spending more is good, but cutting government spending is bad. I hate these magic bull caca artists.

Is a debt to GDP ratio of 132% unsustainable?

 Whenever I see someone write that a certain debt to GDP ratio is unsustainable, my curiosity is peaked.  Read this:  https://finance.yahoo.com/news/global-bond-tantrum-wrenching-worrisome-200009547.html

Bloomberg Economics projects the US debt-to-GDP ratio will reach 132% by 2034 — what many market watchers see as an unsustainable level.

This Finance Yahoo article doesn't show the source which makes me a little skeptical.  And who are these "many market watchers"? This odd phrase makes me think the author is just making this up.  The days of accepting main street news without hyperlinks or footnotes are long over.  And I can't find the article they are referring to.  

But I did find this - https://www.crfb.org/blogs/debt-surges-extensions - which says this "Based on new estimates from the Congressional Budget Office (CBO), debt could reach 132 percent of Gross Domestic Product (GDP) by Fiscal Year (FY) 2034 under an alternative scenario".  It doesn't call this level "unsustainable".  But it does seem to be referring to the same number.

So let's look at it.  Is this debt the "debt held by the public" or the "national debt"?  I think it is the debt held by the public.  For reference, that number today is about $28.8 trillion.  Under the alternative scenario, they say the debt held by the public in 2034 will be $54.8 trillion, almost double what it is today.  So what will GDP be in 2034?  It doesn't say, but using math, it would be $41.5 trillion (currently it is about $29.35 trillion).  

What makes that level unsustainable?  Nobody can say, even though supposedly "many market watchers" are saying that.  I do agree that some level of debt is unsustainable, but I would put that level at about 200% of GDP instead of 132%.  The puppet masters can print money at will, and even magically set the interest rates, and the brainwashed masses just accept it without question, so why would this end any time soon?

Unless cracks start to appear in the system, and the whole thing malfunctions either by burning up or melting down. 

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See also: https://www.msn.com/en-us/money/markets/a-million-simulations-show-us-debt-is-on-an-unsustainable-path/ar-BB1kXUtQ

The United States is almost certainly on an unsustainable path with regard to the astronomic rise in its national debt, according to a million simulations run by Bloomberg. Bloomberg reported Tuesday [4/2/24] that it conducted a million simulations on the U.S. debt outlook and found 88% of them show borrowing is on an "unsustainable path."

Total Kievan Debellation

 https://bigserge.substack.com/p/total-kievan-debellation

In short, Ukraine is on the path to debellation - defeat through the total exhaustion of its capacity to resist. They are not exactly out of men and vehicles and missiles, but these lines are all pointing downward. A strategic Ukrainian defeat - once unthinkable to the western foreign policy apparatus and commentariat - is now on the table. Quite interestingly, now that Donald Trump is about to return to the White House, it is suddenly acceptable to speak of Ukrainian defeat. Robert Kagan - a stalwart champion of Ukraine if there ever was one - now says the quiet part out loud:

Ukraine will likely lose the war within the next 12 to 18 months. Ukraine will not lose in a nice, negotiated way, with vital territories sacrificed but an independent Ukraine kept alive, sovereign, and protected by Western security guarantees. It faces instead a complete defeat, a loss of sovereignty, and full Russian control.

The Bijlmer

This is an interesting video about how a planned utopian city area in Amsterdam called The Bijilmer became a dystopian nightmare. About half of the high rise apartments were demolished and the place is not as bad now.  See also https://en.wikipedia.org/wiki/Bijlmermeer

The North American Technate

 

Source: https://sashalatypova.substack.com/p/trumps-north-american-technate

What is a technate?  

A technate is a large area of land governed by a technocracy, a system of government where decision-makers are chosen based on their expertise in a specific area. The term was coined by Technocracy Incorporated in the 1930s.  The Technate was envisioned as a North American superpower that would use thermodynamic energy accounting instead of money. The idea was to use the region's resources and industry to provide an abundance of goods and services to citizens in a sustainable way. 

 See also: https://en.wikipedia.org/wiki/Technocracy_movement  
https://technocracy.fandom.com/wiki/Technate
https://www.technocracyinc.org/

This sounds like something out of science fiction.

Also read: https://www.ssa.gov/history/briefhistory3.html which mentions Technocracy.  I don't have time right now.

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This is hilarious! Some people are taking this seriously. Should Trump "liberate" Canada from the British monarchy and Greenland from the Danish monarchy?

The Midweek Update - In the Immediate Crosshairs of Trump: Britain, Canada and Greenland - January 8, 2025  

The episode highlights Trump's call for the liberation of countries under monarchy, like Britain, Canada, and Greenland, and examines the implications for other nations and global security.