Bloomberg - A Million Simulations Shows US Debt Danger.

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Now, fresh analysis from Bloomberg Economics offers a sobering perspective. Throw in a whole bunch of different potential combinations of economic variables — some 1 million of them — and 88% of the time, the results show that the debt-to-GDP ratio is on an unsustainable path.

What’s unsustainable? The initial definition is one that sees the ratio go higher over the coming decade than the 97% figure recorded for last year, which was almost double where things were as recently as 2009.

And why is this issue pressing now? Concerns are escalating because the US has now logged years worth of solid growth, with the job market effectively at full employment. And yet the official Congressional Budget Office projections show the debt-to-GDP ratio hitting 116% in 2034 — an all-time high.

BlackRock CEO Larry Fink said last week that the US public debt situation “is more urgent than I can ever remember.” On Monday, Citadel founder Ken Griffin told investors in a letter to the hedge fund’s investors that US national debt is a “growing concern that cannot be overlooked.”

And recall Federal Reserve Chair Jerome Powell weighed in in unusual fashion earlier this year with his admonition that “it’s probably time, or past time” for politicians to address the fiscal situation.

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