Willem Buiter
US federal government debt exceeded $40 trillion in August 2026, triggering concerns about fiscal credibility and sustainability. This column argues that fiscal sustainability should be assessed using the consolidated balance sheet of the federal government and central bank and the present discounted value of current and future primary deficits. This includes accounting for non-debt liabilities as well as real and financial public assets. In total, the federal government’s non-monetary net worth is likely to be significantly higher. Ultimately, calming bond markets will require a fiscal framework that ensures government solvency and satisfies the central bank’s price stability mandate.
Πηγή: VoxEU