Jerome Powell Issues a Warning on US Debt Crisis

Fed Chair Jerome Powell recently commented on the US national debt in a live interview with David Rubenstein, Co-Chairman of Carlyle Group.

During the interview, Rubenstein asked Powell what is the biggest economic challenge the USA faces – is it growth, inflation, or a potential hard landing?

Powell said that what’s keeping him up at night is the thought of balancing their decision – if they ease the rates too early they could undermine the progress on inflation. On the other hand if they wait too long they can undermine economic activity and expansion.

Rubenstein questioned the Fed Chairman about his opinion on the debt crisis the USA is currently facing – a $35 trillion outstanding debt and an additional up to $2 trillion a year.

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Powell said that he is worried about the deficits they are running, but stated that it is not the Fed’s job to give advice to Congress.

What he did say was the USA are on an unsustainable path in the long term, which is one of the biggest issues for elected officials in Congress. He said that large deficits in time of full employment are the key reason for this unsustainable path and it is about time something is done about this.

Powell said that although the path is unsustainable, that doesn’t mean the same for the debt. To fix this he said that it would take a bipartisan effort.

Alexander Stefanov

With over 8 years of experience in the cryptocurrency and blockchain industry, Alexander is a seasoned content creator and market analyst dedicated to making digital assets more accessible and understandable. He specializes in breaking down complex crypto trends, analyzing market movements, and producing insightful content aimed at educating both newcomers and seasoned investors. Alexander has built a reputation for delivering timely and accurate analysis, while keeping a close eye on regulatory developments, emerging technologies, and macroeconomic trends that shape the future of digital finance. His work is rooted in a passion for innovation and a firm belief that widespread education is key to accelerating global crypto adoption.