U.S. Fiscal Alarm Bells Ring as Debt Soars and Economists Call for Safe Havens

As Washington pushes forward with new tax cuts and military funding, a growing number of economists are sounding the alarm on America’s ballooning debt.

One of them is David Rosenberg, who warns that the country’s debt-to-GDP ratio is now climbing past wartime levels, raising serious concerns about long-term stability.

In response, Rosenberg is urging investors to turn defensive. He recommends shifting toward gold, short-term Treasury bills, and even Asian currencies as safer assets in what he describes as a “looming storm.” Surprisingly, he also listed crypto as a speculative hedge—despite normally steering clear of riskier bets.

The recent House-approved legislation—dubbed the “Big Beautiful Bill”—offers immediate tax relief and defense spending boosts but at the cost of deepening the deficit. Rosenberg believes this will further strain the market, especially with the Federal Reserve staying hands-off and letting yields rise instead of absorbing excess debt as it has in past crises.

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“The Fed’s passivity means higher borrowing costs ahead, which could crush both bond prices and stock valuations,” he said.

Fellow economist Peter Schiff echoed those concerns, calling the fiscal package one of the most reckless in modern history. He noted that projected deficits, even before the bill passed, were already approaching pandemic-era levels—warning they could now go even higher.

With policymakers pressing forward and central bankers stepping back, the message from experts is clear: prepare for turbulence, and seek shelter in assets that hold up when everything else breaks down.

Alexander Stefanov