“US stocks kicked off the New Year by reaching fresh record highs, but that doesn’t obscure the urgency of America’s debt problem or the threat to its economy”, cited Global Times, China’s highly read news publication, in its editorial piece late Sunday.
Key Points:
America’s debt burden is the real red flag that can no longer be ignored.
In 2019, global corporate defaults … Of the defaulting issuers, 77 are based in the US, accounting for 66 percent.
US … federal government’s outstanding public debt surpassed $23 trillion for the first time in history.
If you add in state and local debt, corporate debt, home mortgages, credit cards, student loans and other debt, then the total US debt is about 330 percent of GDP.
This comes on the heels of the US and China signing in phase one trade deal next week. While the above piece has little to no impact on the market mood, as it is mainly driven by the ongoing US-Iran geopolitical conflict.
The risk-off sentiment is the main theme so far this Monday, with S&P 500 futures down 0.50% while USD/JPY is back below 108.00 and Aussie is slipping towards the 0.69 handle.
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