The metaphorical Wall of Worry is transforming into a “Ceiling” of sorts as the global economy may have hit multiple ceilings.
Consider these layers of ceilings that are building up:
- The federal debt ceiling is currently $31.4 trillion (set in 2021) against US GDP of $26.5 trillion.
- Prior debt ceilings: $22-27 trillion under President Trump (debt ceiling was paused following the pandemic), $18 trillion under President Obama, $11 trillion under President GW Bush, $6 trillion under President Clinton, $4 trillion under President George Bush, and $2.8 trillion under President Reagan.
- Broad money supply (M2), or the fuel for future growth, which peaked at $21.7 trillion in July 2022 relative to GDP.
By Benjamin M. Lavine, CFA, CAIA, RICP
Chief Investment Strategist, Freedom Advisors & Chief Investment Officer, 3D, a Freedom Advisors company