$35.7 trillion financial emergency declared by Elon Musk that has pushed bitcoin almost to the level of gold
Tech billionaire Elon Musk is warning of a “financial emergency” as US interest payments on its debt are set to surpass a record $1 trillion this year.
Elon Musk has been stumping for former President Donald Trump as he tries to reclaim the White House in the 2024 presidential election. The Republican candidate said last month that he was thinking about establishing a government efficiency commission as suggested by the tech billionaire which he said Musk has offered to lead.
At a recent campaign rally for Trump in Pittsburgh, the Tesla CEO was asked about his plans to make the government more efficient. He responded that basically anywhere you look there is a target, and spending needs to be brought under control so that the government is bringing more money than goes out. He focused on the interest payments that the government is paying to service its debt.
“Already, just the interest payments on the debt are 23% of all federal tax revenue,” Musk said. “The interest payments now exceed the Defense Department budget, which is $1 trillion a year. That’s a lot of money.” He reposted a video of his response on X with the caption: “It is a financial emergency.”
$35.8 trillion financial emergency declared by Elon Musk that has pushed bitcoin almost to the level of gold
Musk ventured during his speech at Trump’s Madison Square Garden rally in New York that a government efficiency commission, which he has dubbed the Department of Government Efficiency (Doge) in reference to dogecoin, the meme-based cryptocurrency, could save as much as $2 trillion from the $6.75 trillion federal budget.
The US national debt has surpassed $35.8 trillion and could reach $36 trillion by year’s end according to projections by Bank of America analysts earlier this year. They also foresee the US national debt adding around $1 trillion every 100 days.
Concerns over unchecked growth of US government debt has sent investors looking for hedges against inflation and lowered purchasing power of the US dollar. Two assets that have benefited are bitcoin and gold.
Gold has seen its value jump by over 34% since the beginning of the year. Bitcoin, while a much more volatile asset, is sometimes referred to as ‘digital gold’.
Its value has recovered this year from the post-pandemic lows and is once again approaching its all-time high of over $73,000 hit earlier this year. Its valuation has been bolstered as well by institutional investors like BlackRock, whose Bitcoin ETF, IBIT, is one of the fastest growing in financial history.