The U.S. narrowly avoids recession through exorbitant fiscal spending, raising questions about the sustainability of such measures. The ideological divide on economic policies, particularly Modern Monetary Theory (MMT), sparks debates on the feasibility of high fiscal deficits, leaving a lingering uncertainty about the future of economic stability.
Exorbitant fiscal spending is probably the main reason the US is not in recession yet. Is it sustainable though? pic.twitter.com/Pb1qQ8GfcI
— Michael A. Arouet (@MichaelAArouet) November 24, 2023
If MMT worked the US or Europe, or the UK could run 25% fiscal deficits and end poverty for all.
As socialists are not able to create anything they must always resort to printing money and/or stealing money from others. t.co/dXE0oSskIx
— Michael A. Arouet (@MichaelAArouet) November 24, 2023
China Dumps $491 Billion US Treasuries in a Decade As Country’s US Debt Holdings Hit 14-Year Low
China, the world’s second-largest economy, has been significantly reducing its holdings of U.S. Treasury securities for over a decade. The U.S. Treasury Department reports that China’s holdings have dropped to their lowest in 14 years, decreasing by over $491 billion from a peak of $1.297 trillion in May 2013 to $805.4 billion as of August 2023. This divestment coincides with Moody’s changing the U.S. credit rating outlook from stable to negative, citing America’s deteriorating financial position and political gridlock. While this doesn’t guarantee a credit rating cut, Moody’s indicates an increased likelihood of such a move in the future, especially if effective fiscal measures to manage government spending or increase revenues are not implemented.