RL168 — The Debt Ceiling Crisis: What You Need to Know

In this episode of the Retirement Lifestyle Show, Erik Olson, Roshan Loungani, and Adrian Nicholson break down the debt ceiling crisis in the US. They discuss how government debt should inform your investment decisions, the risks of the US Treasury not raising the debt ceiling, and what to expect in the coming months. Listen now to learn more about The Debt Ceiling Crisis: What You Need to Know.

[00:00] Introduction

[02:20] What is the Debt Ceiling?

[04:35] Risk of Not Raising the Debt Ceiling Fast Enough

[08:50] Government Debt Vs. the Country’s GDP

[11:50] The Time and Place for a Debt Conversation

[15:56] What to Expect When the US Hits Its Debt Limit

[19:31] Interest Rates and Borrowing Costs

[22:45] Is Cash Now King?

[24:34] Parting Thoughts

To read the Full Show Notes scroll down or click here.

Roshan Loungani can be reached at roshan.loungani@aretewealth.com or at 202-536-4468.
Erik Olson can be reached at erik.olson@aretewealth.com or 815-940-4652.
Adrian Nicholson can be reached at adrian.nicholson@aretewealth.com or at 703-915-8905

Listen now to learn more about The Debt Ceiling Crisis: What You Need to Know.

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Full Show Notes:

What is the Debt Ceiling?

The debt ceiling is the limit that the US Treasury has for how much money can be borrowed. They’ll use that money to finance current policies, pay interest on existing debt, and keep the country solvent. In January 2023, we hit that ceiling, but the treasury was able to take extraordinary measures to extend the time that Congress has to act. Fast forward to May, and Janet Yellen, the treasury secretary, came out and said that we could hit the debt ceiling as soon as June 1st.

The reason the debt ceiling conversation drives a lot of people nuts is that they’re going to approve it. Congress will approve it no matter how much they negotiate and fight or how many American lives will be impacted along the way. As an investor, understand that the debt ceiling will go up. It’s gone up every time. So make your investment decisions knowing that the US government debt will affect interest rates and the cost of borrowing.

Disclaimer Welcome, you are now listening to the retirement lifestyle show with Roshan Loungani Erik Olson and Adrian Nicholson. This show is an exploration of ideas to help you work towards your ideal retirement. Roshan Loungani and Erik Olson serve clients across the US. They offer financial planning and investment advice through Arete Wealth Advisors, LLC, an SEC registered investment advisor and securities through Arete Wealth Management LLC, member FINRA, SIPC, and NFA. Get ready for the financial independence of your dreams. All opinions expressed by podcast hosts and guests are solely their own are based on information they believe is reliable. Neither Arete Wealth nor its affiliates, warrants its completeness or accuracy, nor do their opinions reflect the opinion of Arete Wealth. This podcast is for general informational purposes only and should not be regarded as specific advice or recommendations for any individual. Before making any decisions consult a professional. Finally, our music is the chance by Jason Shaw and Audionautix. It’s part of the YouTube Audio Library and it’s licensed under a Creative Commons license.

Thank you for listening.

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