The Millennial Generation, Cryptocurrencies & US National Debt Future
The Congressional Budget Office calls on the US government to stop spending or risk a fiscal crisis.
The US national debt is the total amount of money owed by the government. Governments borrow in the same way as an individual or organization, spending more money than they earn. In practice, governments borrow by selling treasury notes, treasury bonds and treasury bills.
The latest report released on Tuesday reveals that the US national debt is about to double as a proportion of the country's Gross Domestic Product (GDP) over the next 30 years. The new projections, if accurate, would bring the national debt to levels not seen since the post-World War II years.
It is for this reason that many millennials are expanding their financial portfolios beyond the dollar to include cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH). Non-traditional value stores like these can be unique value investments for millennials given the uncertain future of the dollar.
Public Debt And Cryptos
When debt is used to finance economic expansion, current and future generations can reap the rewards. And for example, the debt used for fuel consumption only has advantages for the current generation.
This is especially true given the fact that it is not clear whether today's young people will be able to receive social security in their old age. The Times reports that Social Security is facing long-term financial problems due to an aging population and a declining “ratio of workers to beneficiaries.”
Continued spending on benefits, coupled with the large reduction in tax revenues resulting from the recent Trump Administration's Tax and Employment Cuts Act of 2017, are the main drivers behind the CBO's report that national debt will increase in the coming decades.
But cryptocurrencies like Bitcoin could provide millennials with a functional reserve of independent dollar value. Thus, if in fact the national debt continues to rise and we begin to see some of the negative results of the government's attempts to repay that debt, the holders of cryptocurrencies will not be forced to deal with the full weight of those results.