Interest is the United States’ Second Largest Expenditure

2025-10-10

One of my principles is that if you’re worried, you don’t need to worry — and if you’re not worried, you need to worry.

That’s because worrying about what can go wrong will protect you and not worrying about what can go wrong will leave you exposed.

2025-10-08

The way I see it, any serious effort to solve the debt crisis will likely come too late.

It’s a timing issue. 2026 is a midterm election year — politicians won’t want to take the painful steps needed to improve our economic picture: cutting spending, raising taxes, and the like.

Any sort of bipartisan effort that comes after will both take time and be unlikely to be effective, because those commissions generally don’t work very well in practice.

That’s what it looks like to me. I’m curious to hear if you see things similarly.

@TheProfGPod

You can watch the full conversation here: _JLSAat94?si=AIGAM6BTiw7ZWCCC

2025-10-06

I want to explain in a nutshell why the US debt situation is at a very dangerous inflection point.

Put simply, the US is now spending 40% more than we’re taking in. This accumulation of debt service payments has spiraled over decades and is starting to squeeze away buying power.

And if you run the numbers, there’s an imbalance between how much debt has to be sold, who the buyers are, and the likelihood of it all being bought.

Together, these two influences are why I worry about suffering an economic heart attack in the near future.

2025-09-29

This simple animated video series answers the question, "How does the #economy really work?" Based on my practical template for understanding the economy.

This series breaks down economic concepts like #credit, #deficits and #interest rates, allowing viewers to learn the basic driving forces behind the economy, how economic policies work and why economic cycles occur.

This is Part 4, I hope you find these helpful.

2025-09-24

I like inflation-indexed bonds — or TIPS (Treasury inflation protected securities) — because they guarantee a real return.

The markets are a zero sum game, and if you’re speculating, you’ll probably be the loser. But these bonds are among the safest asset classes you can find.

2025-09-09

There are smart tariffs and there are not smart tariffs.

Every type of tax, tariffs included, has pros and cons. Done well, tariffs can provide a source of revenue while simultaneously reducing geopolitical risk.

But to be effective, they need to be engineered prudently, efficiently, and surgically.

2025-09-04

I’m doing an AMA on @reddit today, starting at 1pm ET.

I always enjoy hearing from you all, and discussing whatever’s on your mind.

So, if you have any questions for me, go check out the Reddit thread linked in the comments. I’ll get to as many as I can.

2025-09-03

I’m looking forward to doing another AMA and answering whatever questions you have on Thursday, 9/4 from 1-3pm ET.

For over 50 years, I’ve been in the business of studying the cause/effect relationships that drive how reality works and developing principles for dealing with reality well. I then programmed these principles into computers as decision rules to bet on them working. Because the causes come before the effects, this principles-based approach worked amazingly well for me.

Since I’m 76, I’m now at a stage in my life that I want to pass along what’s of value. So far, I’ve passed along my perspectives and principles about how to approach life, work, the changing world order, debt, and markets in my books, videos, and social media. But I think that what is most important is