Last, but certainly not least, the world is also facing a continued debt fiasco in 2019.
At the time of this writing, the national debt in the Land of the Free is nearly $22 TRILLION. And in fiscal year 2019, America’s annual budget deficit will top $1 trillion.
And it’s not just the US government that has a severe debt problem...
The governments in Japan and much of Western Europe are in even worse shape.
And even outside of government, other types of debt have exploded.
Corporate debt is at the highest level on record. Ever. And more than 40% of that corporate debt is rated just barely above ‘junk’ status, i.e. most of the companies who are rapidly expanding their borrowings are on very shaky financial footing.
Consumer debt around the world also reached a record in 2018. In the US, credit card debt, auto debt, and student debt are all at all-time highs.
And the average person has little chance of repaying that debt.
It goes without saying that all of this debt is totally unsustainable. Interest rates are rising, and interest payments are accounting for a larger and larger share of income.
The US government nearly spends as much on interest as it does on national defense.
History shows this to be the point of no return where a nation’s debt makes it feeble and weak.
They’re already borrowing money just to pay interest on money they’ve already borrowed. And the amount of money they’re borrowing is accelerating rapidly.
That’s the troublesome part.
In the Land of the Free, the national debt doubled over the past decade. But interest rates were at least at all-time lows.
Now they’re expanding the debt by more than $1 TRILLION each year at a time when interest rates are RISING.
This is going to reach a critical point over the next few years, and we’re already seeing signs of stress.
But, just like with these other problems, there are steps you can take to make sure you’re protected... like owning specific assets that will drastically increase in value in the face of a government default.