The focus may be on Europe at the moment, but the US has a huge debt problem as well. US Government Debt is expected to hit $16.4 Trillion by the end of this year and it will likely be headline news again as the Presidential election campaign swings into full gear this fall.
A picture is worth a thousand words.
There is too much debt in the world and it is hurting the global economy. At this point, it isn’t clear how the governments and central banks will deal with this problem, but the policy choices they make will significantly impact financial markets. We believe the most likely outcome will be for the central banks to print more money. Our current portfolio allocations are based on this scenario, but we also recognize that it is important to be prepared for a few different possible outcomes. Understanding the big picture will be critical for successful investing over the next few years.
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