What U.S. Debt Headlines Mean for Your Business

Two of my most-watched videos were about the U.S. debt. That tells me the subject frightens people, and frightened people make poor business decisions. They freeze investments that made sense, move cash into the wrong currency or bet the company on a headline.

So here is the cold version, written for business owners and built on official numbers. Where I give my own reading, I'll say so. I'm leaving geopolitics out on purpose, because it doesn't change what you should do with your balance sheet on Monday.

The number behind the headline

The headline is accurate. According to the U.S. Treasury, total public debt outstanding first passed $40 trillion on August 18, 2026, and stood at about $40.4 trillion on October 15. About $32.5 trillion of that is debt held by the public, meaning investors, banks, foreign governments and the Federal Reserve. The other $7.9 trillion is owed by the government to its own trust funds.¹

1. 2008

   Total U.S. public debt passes $10 trillion (September 30).¹

2. 2017

   Total public debt passes $20 trillion (September 8).¹

3. 2022

   Total public debt passes $30 trillion (January 31).¹

4. 2024

   Total public debt passes $35 trillion (July 26).¹

5. 2025

   Moody's lowers the U.S. sovereign rating from Aaa to Aa1 (May 16).²

6. 2026

   Total public debt passes $40 trillion (August 18).¹

The pace matters more than any single milestone. It took about nine years to go from $10 trillion to $20 trillion, and about nine more to double again. Looking ahead, the Congressional Budget Office projects that debt held by the public will rise from 101 percent of GDP in 2026 to 120 percent in 2036, above its previous record of 106 percent, set in 1946. Net interest payments grow from 3.3 percent of GDP to 4.6 percent over the same period.³

Where it reaches your business

Part of that has already happened, though the debt is not the only cause. The average interest rate on credit card plans at commercial banks was 14.60 percent in 2021 and 21.19 percent in August 2026, according to the Federal Reserve.⁴ Consumer credit moved with the whole interest-rate cycle, and the deficit is one force among several.

For a company, the more durable channel is long-term rates. CBO expects the 10-year Treasury yield to average 4.1 percent in 2026 and 4.3 to 4.4 percent from 2027 through 2036, rising gradually because investors demand a higher term premium to hold longer bonds.³ That yield sits under every fixed-rate loan, equipment lease and commercial mortgage you sign. My reading: very cheap long-term money is not coming back soon, and plans that quietly assume it will are going to disappoint.

Banks, for now, are not slamming the door. In the Federal Reserve's July 2026 survey of senior loan officers, banks left standards for commercial and industrial loans basically unchanged for firms of all sizes, while a modest share tightened standards on credit cards.⁵ That can change within a quarter, which is why a credit line negotiated while you don't need it is worth more than one requested in a hurry.

What the alarmists leave out

This is the part of my argument the data supports most clearly. In the IMF's October 2026 World Economic Outlook, general government gross debt in 2025 stands at 124.4 percent of GDP in the United States, 204.8 percent in Japan, 137.1 percent in Italy, 115.5 percent in France, 113.6 percent in Canada and 102.1 percent in the United Kingdom.⁶ The IMF counts all levels of government, so its U.S. figure is higher than CBO's. Its April 2026 Fiscal Monitor says global public debt rose to just under 94 percent of world GDP in 2025 and is set to reach 100 percent by 2029.⁷

Then the replacement question. In the reel I argued that no other currency or region can take over the role of the American economy, not even China. Research by Federal Reserve Board economists is more measured but points the same way: the dollar made up 58 percent of disclosed global official reserves in 2024, against 20 percent for the euro, and it was on one side of about 88 percent of foreign-exchange transactions in April 2022. The authors conclude that, absent large and lasting disruptions, the dollar will likely remain the dominant international currency for the foreseeable future.⁸

In a follow-up talk I go further and describe what I see Washington attempting: grow the economy faster than the debt, with energy and AI as engines, attract new buyers for Treasury bonds, and restrain spending. Those are policy bets, and I said plainly that they could fail. CBO's baseline already assumes faster productivity growth as generative AI spreads, and it still shows debt rising as a share of the economy.³ Judge the plan by those numbers each year, not by the speeches around it.

A planning method for business owners

My reading

Debt this large is a real problem, and it will cost something: higher interest for longer, more pressure on public budgets and moments of market nerves, like the day in May 2025 when Moody's lowered the U.S. rating from Aaa to Aa1.² It is not a reason to stop building a company. The opportunity in the U.S. market doesn't disappear because the Treasury borrows more, and a company with a clean balance sheet negotiates from strength when others are nervous.

If you are planning a U.S. market entry or a raise, the debt belongs in your assumptions, not in your fears. That is how we build plans in capital and investor readiness work, and it is the same discipline behind Strategic Entropy™: question the premise, then measure it. The operating side of the same mindset is in The Hidden Cost of Insecurity for Companies in Mexico and Why Selling More Can Hurt Your Company.

I promised a cold perspective without ideology, so you could reach your own conclusions. Here is mine: treat the debt as a cost-of-capital question, plan for it like one, and turn the volume down on everything else.