Nassim Taleb, who accurately predicted the 2008 financial catastrophe, warns government debt is causing a ‘death spiral’ in the U.S.(Part-1)

The national debt issue has been described as the "most predictable crisis" confronting the American economy, and one analyst has even gone so far as to say that a "miracle" is necessary to rescue the country.

The Black Swan author Nassim Nicholas Taleb foretold the financial crisis of 2008 and has since stated that "gloomy" economic periods in the United States are much easier to see coming.

The national debt is a "white swan" danger, according to Taleb, who advises the Miami-based hedge fund Universa Investments. He made this statement during an event given by the group this week.

According to Bloomberg, he emphasized that a debt spiral will ultimately occur if Congress continues to increase the debt ceiling and strike agreements out of fear of the repercussions of doing the right thing. A debt spiral can be compared to a death spiral.

With the debt ceiling postponed until 2025 thanks to an agreement struck in the summer of 2023, the current American national debt is at $34.14 trillion, or almost $100,000 for every citizen in the US.

Even if there are some positive signs for the economy in the near term, such as falling inflation, the Federal Reserve considering rate reduction, and steady employment, prominent figures like Jamie Dimon are raising concerns, including Taleb.

According to JPMorgan Chase CEO Jamie Dimon, "It is a cliff" and a worldwide market "rebellion" over the debt level is what Washington is facing, as he stated last week. This is the cliff. Look out roughly ten years.

In a similar vein, Robert Rubin, who served as treasury secretary from 2011 to 2013, recently stated that the United States was in a "terrible place" due to the deficit and advocated for revenue hikes to rectify the situation.