SoberLook - The U.S. Debt to GDP Ratio will Soon Look Like the Eurozone Periphery


Author: Walter Kurtz
Location: Tokyo
Date: 2012-06-26

Barclays Capital released the latest forecast of gross government debt-to-GDP ratios for a number of nations. Here is how the US compares to the more leveraged countries in the Eurozone going forward.


Debt to GDP ratio for select countries (source: Barclays Capital)

The market has instilled some discipline around the periphery nations' debt growth. There is a natural limit to how much they will be able to borrow. Not so for the US, as the world seems to have a seemingly endless appetite for US government paper (for now). And of course the Fed is always there to pick up any slack. At this rate in a few years the US debt to GDP ratio will look very much like that of the Eurozone periphery.

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