The Federal Reserve Group to allow the free inflation of Rylene to deal with “Defacto” calls from Elfacto
The Federal Reserve is expected to maintain interest rates at its meeting this week, amid fears of fleeing inflation and escalating national debt. According to The Wall Street Mav, an American economic monitoring group on X, 25 % of the taxes collected in America are used to pay the accumulated interest from government debts.
Tesla CEO and billionaire ELON Musk said that America is “in reality” due to the burden of interest payments on the debts of the federal government of $ 36.2 trillion.
“If this continuesMusk wrote in x monday, “America actually disappears and all tax revenues will go to pay interest on national debt with no other revenues“
In response, economist Peter Chef Add That the situation is already outside the recovery point. “We are already bankrupt,“The fugitive inflation” is expected to move as a recent attempt to manage interest costs before the total tax revenues exceeded, “said Chef, who is expected to move the federal reserve.
Eclipse defensive spending payments, debt still rises
According to Treasury data, the United States government spent about $ 1.2 trillion on interest payments in the fiscal year 2024, or nearly a quarter of its total tax revenues of $ 5 trillion. Total federal spending exceeded $ 7 trillion, as interest payments exceeded the national defense expenditures.
If this continues, America escapes bankruptcy and all tax revenues will go to pay interest on the national debt without anything else remaining. https://t.co/lj1rgywhgg
Elon Musk (@elonmusk) June 16, 2025
In what Havard’s historian Niall Ferguson calls “Ferguson’s Law”, if a country spends more on the debt interest than military defense, it risk losing its global financial position.
The United States is now violating this rule. Defense Spending In 2024 it amounted to 883.7 billion dollars, and the interest bill exceeded $ 1.1 trillion. Ferguson stressed that most of the global forces that “borrow recklessly” and this threshold eventually exceeded a national financial collapse.
“Any great force follows a reckless financial policy by allowing the cost of its debts to exceed the cost of its armed services opens itself to challenge.” “The United States is just the latest great power to find itself in this financial jam,” Ferguson continued.
It feeds on inflation expectations
Use interest rates will likely remain unchanged at the Federal Open Market Committee meeting on Wednesday (FOMC). However, federal reserve officials are still watching inflation expectations against the background of the high tariffs and uncomfortable consumers.
Since March, the Trump administration has outlet Several tariffs are increasing, which prompted some companies to raise prices proactively. Residents expect the owners to rise, and workers may seek higher wages in the coming months.
“If everyone expects inflation to rise, it will rise. This is what the Federal Reserve Bank is concerned,” said Alan Demeyster, an UBS economist.
Although modern inflation readings were relatively moderate, inflation expectations were supported again.
Ray Faris, chief economist in Eastspring Investments, warned that many Americans are now more sensitive to high prices after living during an increase in inflation 2021-2023.
“The federal reserve is right to sit on his hands and does nothing here,” Faris explained. “But it should be uncomfortable with any of the increase in inflation expectations that some survey studies have shown.”
He added that consumers do not believe that inflation is under control, even if modern data indicates otherwise. Faris concluded that “there is more prepared to accept that prices are rising, and this makes it easier for companies to impose more.”
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