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The U.S. national debt has entered a stage that many economists now describe as completely unsustainable. With annual deficits exceeding $2 trillion and interest payments alone consuming nearly one-fifth of federal tax receipts, the Treasury faces a fiscal trap. Three years ago, only 8% of tax revenues went to service the debt; today, that figure has more than doubled to 18.6%. The Congressional Budget Office projects this burden will keep climbing as nearly $9 trillion of low-yield debt matures over the next five years and must be rolled over at much higher rates, closer to 5%. At some point, Washington will be forced to act.
Clive Thompson, a highly respected analyst in the gold markets, has put forward one of the most radical yet historically proven options available to policymakers: a revaluation of America’s gold reserves. Officially, the U.S. still carries its gold on the books at $42.22 per ounce, a figure frozen since the early 1970s. That means the Treasury’s 261 million ounces of gold, worth nearly $900 billion at today’s spot price, is being reported as an asset worth less than $11 billion. Thompson argues that correcting this imbalance—by revaluing gold to market levels or higher—could provide the U.S. Treasury with an immediate windfall in the trillions of dollars, without technically increasing the national debt.
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261 million ounces of gold revalued @ $15,000 per ounce is recommended.
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