Jennifer Sor

Sun, Jun 15, 2025, 1:15 PM5 min read

• Top experts are sounding the alarm about a potential debt crisis, Goldman Sachs said.

• The bank interviewed three economy pros about their outlook for the US fiscal situation.

• The top insights from Ray Dalio, Ken Rogoff, and Niall Ferguson are detailed below.

Investor concerns over a swelling government debt load were soothed last week. But some experts say the US isn't out of the woods yet.

Goldman Sachs spoke to three top economic experts — Ray Dalio, Ken Rogoff, and Niall Ferguson — about rising debt levels in the US. All three said they were worried about an impending debt crisis, particularly when considering the effects of President Donald Trump's GOP tax and spending bill, which has been estimated to add trillions to the budget deficit over the next decade.

That reflects a slightly more pessimistic view than the market. After a scare last month, demand for long-dated government bonds was strong this week. It was a sign that investors are feeling more comfortable about the fiscal situation in the US, after showing nerves last month after Moody's downgraded US debt and Trump's tax bill began making its way through Congress.

Here are the top points each of the experts had to make:

The billionaire hedge fund manager said he sees three factors determining the outlook for the US debt.

1. How much the government pays on debt interest relative to its revenue. If interest payments keep rising, it can "unacceptably" prevent the government from spending money on other things.

2. How much debt the government needs to sell relative to demand. If the government needs to sell more Treasurys than people are willing to buy, interest rates will have to rise. That provides a more attractive yield to investors to hold onto the US debt, but high rates also hurt markets and the economy.

3. How much money the central bank needs to print in other to purchase the remaining debt. If demand for US Treasurys is especially weak, the Fed can step in to purchase bonds to keep the government funded. If it has to print more money to do so, that can raise inflation and ding the value of the US dollar.

"One can easily measure these signs of deterioration and see movement toward an impending debt crisis," Dalio, who has long warned of troubling debt dynamics in the US, said. "Such a crisis occurs when the constriction of debt-financed spending happens, like a debt-induced economic heart attack."

To prevent a crisis, Dalio said he believed the government should reduce the budget deficit to 3% of GDP. Reducing the debt could cause interest rates to decline around 150 basis points, he estimated, reducing interest payments on the national debt and stimulating the economy.