Prominent billionaire investors are raising urgent alarms about the U.S. economy’s trajectory after Congress passed The One, Big, Beautiful Bill on May 22, 2025. The legislation, designed to extend Trump-era tax cuts and spur economic growth, has drawn sharp criticism for prioritizing short-term spending over fiscal responsibility.
Key Developments:
- Chamath Palihapitiya, speaking on the All-In Podcast, slammed the bill as a reckless "debt-financed industrial policy" that risks destabilizing the economy. He warned of soaring Treasury yields (10-year nearing 5%, 30-year approaching 6.5%) and potential credit downgrades.
- Elon Musk echoed concerns, arguing that only "exponential GDP growth" and radical productivity improvements—not temporary fixes like the DOGE program—can prevent economic collapse.
- Both investors predict a flight from U.S. debt to alternative assets like gold and Bitcoin if yields surge further, sparking a destabilizing cycle of deleveraging and dollar depreciation.
Critical Concerns:
Palihapitiya emphasized that rising borrowing costs could erode global confidence in U.S. debt, prompting credit agencies to downgrade the nation’s rating. Musk added that unchecked government spending without matching productivity gains could push the economy to a breaking point.
The Bottom Line:
The U.S. faces a pivotal choice: continue deficit-driven policies risking long-term instability or pivot to sustainable fiscal strategies. Experts warn that lawmakers’ decisions now will shape the nation’s economic future for decades.
