The U.S.** faces debt crises and shutdown risks, and global markets are being hit. The U.S. is a bipartisan stalemate over the 2024 budget, and if an agreement cannot be reached by the deadline, the U.S. will have to stop some non-essential public services. There is a high possibility that the major investment banks will close their doors in the United States.
The U.S.** is in a tight fiscal position, with as much as 7 percent of its debt to repay in the coming year6 trillion dollars, while its total revenue is only 35 trillion US dollars, the gap reached 4 trillion US dollars, equivalent to 30 trillion yuan. If the doors are closed, the U.S. credit rating will face a downgrade, which will lead to higher borrowing costs in the U.S. At present, the yield of US Treasury bonds is at an all-time high, and the debt-to-GDP ratio is constantly breaking records. The budget impasse in the United States reflects the profundity of American society.
For the sake of their own political interests, the two parties do not hesitate to sacrifice the overall interests of the country, do not make concessions to each other, and even use budget negotiations to advance their own agendas. This political rigidity has weakened the United States' ability to govern and affected its international image. The plight of the United States has brought great uncertainty to the global capital market. The U.S. continued to decline, hitting new lows in this round of correction, and both tech and real estate stocks showed signs of a bubble. Safe-haven assets such as ** and ** were also sold off, falling to a half-year low and falling sharply. With the exception of the relatively strong US dollar, other assets are under pressure.
In my opinion, the budget crisis in the United States is the eruption of structural problems that have accumulated in the United States for a long time. The United States needs to carry out profound political reforms, restore the spirit of bipartisan cooperation, balance fiscal revenues and expenditures, reduce debt levels, and improve economic efficiency in order to get out of the predicament and stabilize the market. Otherwise, the United States is at greater risk and may even lose its global leadership.