Is the Fed balance sheet still skyrocketing?

The Spotlight

1 minute read

Apr 12, 2021

US national debt representation

The US has seen its debt ballooning in less than a year putting the FED in dangerous territories.

In short: yes.

Curious to know by how much exactly?

Well, here it is:

Since July, 2020, a mere 27 weeks, the Federal Reserve grew its balance sheet at a pace of $15.3 billion per week.

And since January 13, 2021?

The pace has accelerated to roughly $40 billion a week.

In all, the US debt rose from under $700 billion in 1999 to $28 trillion today.

United States Federal Reserve balance sheet graph representing the debt increase over the last few years

This means the US debt is now worth 134% of the GDP.

A chilling number when analysts are pointing out that almost all countries to have reached a debt level of 130% of GDP in the last 200 years ended up defaulting within the next years through inflation, devaluation, etc.

And this trend does not look like it is about to slow down as the US senate recently voted a $1.9 trillion rescue plan and the White House is currently pushing for a huge multi-trillion dollar infrastructure plan.

But maybe those freshly printed dollars are nothing to worry about.

Maybe the economic recovery will ensure debt payments remain manageable and the US will not default on its debt.

Maybe inflation will be kept in check (despite already rising commodities and food prices).

But maybe, now could also be the time to protect your assets with a little gold, just in case.


Photo credit: LendingMemo


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