Stop thinking of U.S. debt as just a number—37 trillion dollars is already a "live volcano" that could collapse the economy. Even more frightening is that it is expanding at a rate of 55,000 dollars per second. It took less than 9 months to move from 36 trillion to 37 trillion. At this pace, it could break 50 trillion by 2030.
Let’s clarify the misconception: creditors are not just China.
Many people believe that "China is the largest creditor of the United States," but this is an old story. Currently, 37 trillion dollars in debt, 76% is held by Americans themselves—banks, the Federal Reserve, and retirement funds are the main players, while overseas investors only account for 24%. China's holdings have fallen to the lowest point since 2009. The real trouble lies in the speed and structure of the debt increase.
Fatal hidden danger: interest consumes a quarter of income
What Musk said is not an exaggeration: America is 'rapidly heading towards bankruptcy.' In 2025, just paying interest will cost $1.4 trillion, which is more than the total of defense budget and healthcare spending, accounting for 26.5% of fiscal revenue. Worse still, $9.2 trillion in debt will mature this year, and in a high-interest environment, for every 2% increase in new bond interest, an extra hundreds of billions will have to be shelled out each year, completely trapped in a 'borrowing new to pay old plus interest' death spiral.
Dollar hegemony is failing, and 'printing money to rescue the economy' is no longer effective.
In the past, the US could muddle through by printing money and issuing bonds, after all, the dollar is a global hard currency. But that no longer works: the dollar's share of global foreign exchange reserves has fallen below 50%, many countries are starting to settle in their own currencies, and even the price of gold has surged past $3,200 per ounce; everyone is quietly fleeing. Worse still, international rating agencies have withdrawn the US's AAA rating, and foreign capital continues to sell US Treasury bonds, making borrowing increasingly difficult and expensive in the future.
In the end, it is ordinary people who foot the bill.
Don't think the debt crisis is far from life. The depreciation of the dollar has pushed up global inflation, and middle- and low-income American families have to spend an extra $3,800 a year, with shoe and clothing prices rising nearly 40% in the short term. American households' own debts have also collapsed; among $1.2 trillion in credit card debt, nearly half of the people cannot pay their bills, and the default rate for low-income groups has soared. The government has no money for people's livelihoods and can only shift the pressure onto the public, which is the most tangible cost.
Will it really go bankrupt? In the short term, relying on hegemony to prolong life; in the long term, it must explode.
Optimists say 'the dollar hegemony can hold on,' after all, US Treasury can print money. But pessimists have shattered the truth: the speed of debt growth has long exceeded GDP, interest keeps rolling over more and more, and sooner or later no one will want to buy new bonds. Moody's has warned that this is a 'major tail risk'—once a bond auction fails, the credit of the dollar will collapse, worse than the 2008 financial crisis.
Today's America is like riding a broken bike downhill, with the brakes (dollar hegemony) still malfunctioning. Bankruptcy may not come tomorrow, but with each additional debt, it gets one step closer to the cliff.
