Question

the debt situation in the US and is referred as 'US mysteries'. explain these mysteries and why, the US is in a unique position relative to the rest of world. includes a discussion of exorbitant privilege and 'dark matter.' Complete with explanation of why some are worried about the sustainability of this unique position and what the consequences would be on the US economy if we lost this 'unique position.'

Answer 1

Debt situation in US has been biggest mystery as the US corporations have been sitting on an unparalleled debt crossing 1.9 Trillion $.

The situation is double whammy because Us has seen very robustness in economic activity with growth stability at 3% and inflation below2% and unemployment near 4% which are all great macros.

Secondly the Trump administration has been adopting expansionary fiscal policy with large scale government spending and hence borrowing and debt has increased significantly

Hence such unique position is difficult to forego with substantial growth and robust macros and high level of indebtedness . Hence hasbeen big cause of worry regarding how sustainable the debt hasbeen and what shall its potential repercussions hold in near term.