US GDP to reach over $33T in 2026 in updated government economic projections

[F-22Raptor]

 

[dani191]

and the debt will be 40 trilion

 

[F-22Raptor]

US GDP in 2023 will be over $27.5T

 

[dani191]

US GDP in 2023 will be over $27.5T

the debt?

 

[F-22Raptor]

The US economy should surpass $30T around halfway through 2025

 

[Sliver]

and the debt will be 40 trilion

am pretty sure you already know this. but just having high debt doesnt mean anything bad without knowing the other economic variables.


for example, a person can have
a million dollars in debt,
make 200k per year

1) if they used those million dollars of debt to buy a house that is now valued at 1.5 million - that is good

2) if they used those million dollars to go on a vacation, but now have no other debt and will are paying the interest + some principle on the debt - is not bad - just need to be careful

3) used those million dollars to buy a car and now need to pay a lot of money towards the insurance/upkeep of that car and dont have enough money even to pay interest on that debt - this is a vicious cycle, need to get rid of the car or increase income, else will go bankrupt.

the US is in #1 or #2 scenario.
our dear pakistan is in #3 scenario

 

[dani191]

am pretty sure you already know this. but just having high debt doesnt mean anything bad without knowing the other economic variables.


for example, a person can have
a million dollars in debt,
make 200k per year

1) if they used those million dollars of debt to buy a house that is now valued at 1.5 million - that is good

2) if they used those million dollars to go on a vacation, but now have no other debt and will are paying the interest + some principle on the debt - is not bad - just need to be careful

3) used those million dollars to buy a car and now need to pay a lot of money towards the insurance/upkeep of that car and dont have enough money even to pay interest on that debt - this is a vicious cycle, need to get rid of the car or increase income, else will go bankrupt.

the US is in #1 or #2 scenario.
our dear pakistan is in #3 scenario

only the intrest on the debt will be 2 trilions in year

 

[Stranagor]

Media hysterics aside, the sky isn’t falling on the national debt

Despite higher-than-ideal levels of inflation still lingering, there’s no indication we’re close to the point where the deficit is part of the problem.

thehill.com

....

They couldn’t be further from the truth. For all their claims that the federal debt is out of control, the truth is the exact opposite — thanks to raised interest rates and inflation, the federal government’s books are actually in a significantly better place than they were just a few years ago.

Imagine if you were on the hook for a lot of debt at very low-interest rates at a time when market interest rates and inflation both ticked up. That’s a good place to be, right? The real value of your debts drops precipitously. You can either pay your debts off immediately at a discount, because increased interest rates make your low-interest loans less valuable, or you could continue paying them off over time with dollars that, because of inflation, are worth less than the dollars that you borrowed years ago. Either way you, as a borrower, come out ahead; the lenders lose out.

That’s exactly the position the United States Treasury finds itself in. Two years ago, in June of 2021, the value of all federal debt not owed to the government itself was, according to the Dallas Fed, about $22.64 trillion. Two years later, despite several trillion dollars of additional borrowing, that number has barely increased at all, to only about $22.86 trillion. During that same time, according to the St. Louis Fed, our gross domestic product has increased from $23.05 trillion to $26.80 trillion.

When you do the math, you see that the ratio of debt to GDP, which many economists consider to be a much more important number than total debt, has actually decreased over the last two years, from 98.2 percent to 85.3 percent.


That’s a huge decrease. If anything, the media should be celebrating America’s improving debt situation. Instead, their strenuous efforts to paint as grim a picture as possible have become almost comical. The Post, for example, stresses how the deficit shouldn’t rise so sharply in a “good economic year,” with higher tax revenue and fewer people requiring government aid. Then, a few paragraphs later, it explains that the economy in 2022 wasn’t all that good for tax receipts, with slumping home sales and the worst stock market performance since 2008.

There’s a great deal of misinformation around what the national debt means, and why deficit spending exists in the first place. It’s certainly true that deficit spending can create an issue if the federal government puts too much money into the global economy. It can devalue the dollar and contribute to inflation. But deficit spending also serves an important purpose in our economy. Treasury securities held by the public are part of the money supply. They provide liquidity. As the economy grows, we need more, not fewer, Treasury securities outstanding. And, with the U.S. dollar serving as the primary reserve currency for the world economy, as the global economy expands, foreign governments will need to increase their holdings of U.S. treasury securities proportionately.

Despite higher-than-ideal levels of inflation still lingering, there’s no indication we’re close to the point where the deficit is part of the problem. The most often cited measure of the money supply, the M2, actually declined by nearly $1 trillion between May of last year and April of this year. Historically, that level of short-term decline is unprecedented.

...

 

[ZeroAndOne]

US GDP in 2023 will be over $27.5T

Assuming this year GDP is $28T, U.S. need to growth more than 5.5% per year in the next 3 year in order to reach $33T GDP in 2026. Nevertheless, according to Trading Economic website about United States GDP Annual Growth Rate (https://tradingeconomics.com/united...he last ten years,reached the 5 percent level.), in the last ten years, the average (growth) rate has been below 2 percent and since the second quarter of 2000 has never reached the 5 percent level. Only in 2021, U.S. growth rate reached 5.95% but the year before was -2.77% due to Covid.

Based on historical data, it is very unlikely that U.S. will reach $33T in 2026. But I would never say it is totally impossible.

 

[StraightEdge]

Assuming this year GDP is $28T, U.S. need to growth more than 5.5% per year in the next 3 year in order to reach $33T GDP in 2026. Nevertheless, according to Trading Economic website about United States GDP Annual Growth Rate (https://tradingeconomics.com/united-states/gdp-growth-annual#:~:text=In the last ten years,reached the 5 percent level.), in the last ten years, the average (growth) rate has been below 2 percent and since the second quarter of 2000 has never reached the 5 percent level. Only in 2021, U.S. growth rate reached 5.95% but the year before was -2.77% due to Covid.

Based on historical data, it is very unlikely that U.S. will reach $33T in 2026. But I would never say it is totally impossible.

That's not exactly how GDP and growth rates are calculated. And that's also why those GDP numbers are pointless. Let me give a few points -

GDP (as in nominal GDP) is NOT related to growth rate published by govt or other institutions.
eg.,
US GDP (2021) = 23.32
US GDP (2022) = 25.46
----------------
Calculating the growth from this number = 9.18%
But, we know actual GDP growth is only 2.1%.

What you see here it the effect of inflation. GDP growth numbers are calculated based on 'Real GDP', not nominal GDP.

The actual calculation is the following:

What you see in red it 'Real GDP' of US. You will find that 2.1% increase is coming from this table, not the pointless 'nominal GDP' mentioned by OP. So, if someone says US GDP will reach 35 trillion by next few years, it's possible. But it has no meaning, as everything is inflation.

The nominal GDP can increase even without any growth, technically those numbers mentioned have very less value for economists. Only OP here likes to post this everyday.

ohh, here's something more important.
US is spending more than $2 billion per day ($808 billion for current fiscal) on interest payment for debt servicing and increasing at a massive rate.

This number will become 1 trillion per year within next few months. US is spending more on debt than on their defense.

 

[ZeroAndOne]

That's not exactly how GDP and growth rates are calculated. And that's also why those GDP numbers are pointless. Let me give a few points -

GDP (as in nominal GDP) is NOT related to growth rate published by govt or other institutions.
eg.,
US GDP (2021) = 23.32
US GDP (2022) = 25.46
----------------
Calculating the growth from this number = 9.18%
But, we know actual GDP growth is only 2.1%.

What you see here it the effect of inflation. GDP growth numbers are calculated based on 'Real GDP', not nominal GDP.

The actual calculation is the following:
View attachment 955339

What you see in red it 'Real GDP' of US. You will find that 2.1% increase is coming from this table, not the pointless 'nominal GDP' mentioned by OP. So, if someone says US GDP will reach 35 trillion by next few years, it's possible. But it has no meaning, as everything is inflation.

The nominal GDP can increase even without any growth, technically those numbers mentioned have very less value for economists. Only OP here likes to post this everyday.

ohh, here's something more important.
US is spending more than $2 billion per day ($808 billion for current fiscal) on interest payment for debt servicing and increasing at a massive rate.

View attachment 955340

This number will become 1 trillion per year within next few months. US is spending more on debt than on their defense.

Thank you for your explanation. Much appreciated.