Global debt rose by $1.3tn to a new ATH of $315tn in Q1 2024.
Moreover, after 3 consecutive quarters of decline, global debt-to-GDP resumed its upward trajectory in Q1 2024. Emerging market debt topped $105tn in Q1 2024, w/largest increases coming from China, India, Mexico. Source: HolgerZ, IIF
The US consumer (risk) in one chart: credit card debt at record high, personal savings rate record low
Source: www.zerohedge.com
Money debasement
Source: CNBC
Smaller companies generally spend a much higher % of their income on debt service, making them more sensitive to rising rates.
The interest coverage ratio (operating income / interest expense) for the small cap S&P 600 is 2.3 times vs. 7.6 times for the large cap sp500. Source: Charlie Bilello
The US Federal debt is set to DOUBLE in just 8 years, rising from $20 trillion in 2017 to $40 trillion in 2025.
Currently, US Federal debt is rising by a whopping $1 trillion every 100 days. To put this in perspective, if US debt hits $40 trillion in 2025 that would be a $17 TRILLION increase since 2020. That would be a ~570% jump in US Federal debt since 2000, a 25-year period. The worst part? This analysis assumes that we are on track for a "soft landing." What happens if a recession hits? Source: The Kobeissi Letter, BofA
Is there a chance for the us to start slowing down the pace of debt increase?
Well... think about this: "I'm the king of debt. I'm great with debt. Nobody knows debt better than me." - Donald Trump Source: Ronald-Peter Stoeferle, CMT, CFTe, MSTA
Cartoon of the Day by Hedgeye
$34.6 TRILLION and counting... Are we past the point of no return?
Debt
Source: Hedgeye
