On January 20, 1981 when President Reagan was inaugurated, the U.S. national debt was just under $1 trillion. When he left office it was $2.6 Trillion Dollars.
âWe don’t have a trillion-dollar debt because we haven’t taxed enough; we have a trillion-dollar debt because we spend too much.â âRonald Reagan
During the eight Regan years, the US moved from being the world’s largest international creditor to the largest debtor nation.
Fast forward to President Bush 43: At the end of calendar year 2000, the debt stood at $5.629 trillion. Eight years later, the federal debt stood at $9.986 trillion.
Under President Obama: The debt started at $9.986 trillion and escalated to $13.7 trillion, a 38 percent increase over two years.
Somewhere along the way, both Republicans and  Democrats kept spending and borrowing. Presidents, Congress, The Federal Reserve, and the American people decided debt does not matter.
âThe U.S. government has such a voracious appetite for debt that the rest of the world simply doesn’t have enough money to lend us. So now the Federal Reserve is buying most U.S. debt, and the only reason it can do that is because it can create money to lend out of thin air — at the mint’s printing presses!â âCBSnews.Com July 2011
Fast forward to December 2020â
The Fed now owns a record 16.5% of all the outstanding US public debt.
In the last 12 months, the Fed has doubled its holdings of Treasuries.
The Federal Reserve bought and added $2.4 trillion in US government bonds to its balance sheet.
The Fed has monetized almost all the debt the U.S. issued in the last year.
With near-zero interest rates, there are fewer and fewer investors who want to buy U.S. debt paying less than next year’s inflation rate. Itâs worse in Europe where theyâre paying negative interest rates.
Total U.S. National Debt $27.42 Trillion Dollars
We are now two months into the 2021 fiscal year and the US government is nearly halfway to a $1 Trillion deficit.
In just two months, we have created half the debt that the U.S. Government accumulated from World War I, World War II, the Korean War, the Cold War, the Vietnam War, and the War on Poverty up until the end of 1980.
The mainstream media doesnât care about debt. Very few people in Washington care. Now, we are on the verge of creating another Trillion Dollars of debt and spending it on the second Coronavirus stimulus.
Monetary Inflation Out of Control
The money printed to buy the new US debt exceeding $4 Trillion Dollar is monetary inflation.
“Inflation is always and everywhere a monetary phenomenon.” Â âMilton Friedman
Monetary inflation is devaluing the buying power of your money as a matter of official government policy.
A weaker dollar buys less in foreign goods. This increases the price of imports, contributing to inflation. As the dollar weakens, investors in the benchmark 10-year Treasury and other bonds sell their dollar-denominated holdings.
Sooner of later, if we dance to the music, we’ll have to pay the piper.
