US stock market is overlooking the rapidly growing national debt

Sven

Interesting comment from hedge fund manager, Leon Cooperman:

Risks for the market
The nation's rapidly growing national debt is among Cooperman's biggest concerns.Instead of whittling down the federal deficit when the economy was strong, Trump directed the federal government pile on even more debt to pay for massive tax cuts and spending surged, which meant the country entered the coronavirus crisis in rough financial shape. Now, the national debt is exploding as Washington scrambles to rescue the US economy from the shock of the pandemic.
"I am focused on something the market is not focusing on at the present time and that is: Who pays for the party when the party is over?" Cooperman said. The deficit is growing at a rate "well in excess of the growth rate of the economy," he added. "To me, that means more of our nation's income will have to be devoted to debt service, which will retard economic growth in the long term."

https://cnn.com/2020/07/20/investing/leon-cooperman-stock-market-overvalued/index.html

sfnative

Sure wish my personal finances could be finagled the way the nation's are.

Mark

IMHO Mr. Cooperman is dead right.

MikeM

Trump directed the federal government pile on even more debt to pay for massive tax cuts and spending surged,

This of course is a voting ploy witch quite frankly, both parties endorse to win elections. It's the people who are stupid. They, the government, will likely send me another check which I do not deserve or quite frankly need. Will that win my vote?

Crash

sfnative said:

Sure wish my personal finances could be finagled the way the nation's are.

Yes, wouldn't THAT be lovely???!!!
@Mark is correct, too.

@rono has written about this many times lately. "This will not end well." The dollar will lose quite a bit of value. Inflation will sooner or later run rampant. And "Brother, can you spare a dime?" will become "Brother, can you spare a sawbuck?"

I notice that the EU has reached a landmark stimulus agreement. I'm currently reading Vaclav Havel's "To The Castle And Back." In it, he mentions how the EU bureaucracy is like a hairball, a quagmire of committees upon committees upon committees. So, they have a monetary union, but no fiscal union. And Havel was thinking that someone, somewhere, ought to be THE designated leader at the top of the heap. But it did not happen that way.
https://www.google.com/search?client=safari&rls=en&q=what+is+a+sawbuck&ie=UTF-8&oe=UTF-8

davidrmoran

what happens is that, with good luck, we grow our way out of it

this has been rehashed again and again recently, but the guy has not kept up, clearly

it is nothing like a household, involving moneys we owe ourselves chiefly, my spending is your income and your spending is my income

the hyuge WWII debt was never 'paid back', just one important example

so now of all times is NOT the time to worry in this fashion, when what we need is immense disaster relief

a worthy thing to incur debt on

same w infrastructure

transfers to the already wealthy is the very worst thing to spend on

think of it like investment

FD1000

"The deficit is growing at a rate "well in excess of the growth rate of the economy," he added. "To me, that means more of our nation's income will have to be devoted to debt service, which will retard economic growth in the long term."

The above has been true 5-10-15 years ago too as the deficit was growing under both parties and...here we are.
If you believe in that let us know when are you selling everything

As usual, I disregard all articles and forecasts and concentrate on what markets are doing now.