The Government Shutdown Isn’t Stopping the Debt

U.S. debt just topped $38 trillion for the first time.

It happened while the government was in “shutdown,” which really didn’t shut down much at all:

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Despite a shutdown which has put government spending on a partial pause, total U.S. debt has topped $38 trillion. (Source: FRED)

And it’s a trend that will continue higher, shutdown or not, thanks to the inexorable march of entitlement spending.

Alternative assets like gold and bitcoin are trading off their highs right now, but rising levels of debt and an ongoing political impasse will likely mean much higher price moves for these assets in dollar terms.

The debt is also helping inflate the stock market. Caveat emptor.

~ Addison

P.S. Today on Grey Swan Live! — specifically, at 2 p.m. ET — we’re going down the Anatomy of a Stock Market Bubble: the impressive list of historical records this terrifying bull market has already hit — including retail investor buy-in, record margin debt and capital concentration at the top of the S&P 500.

We’ll also lay out in simple terms the AI crash scenario. Mostly, so you’re aware of what’s at stake, where we think this market is going.

As Andrew Ross Sorkin, author of Too Big To Fail, said this week while promoting his new book “1929,” if we’re all in agreement this is a bubble in AI stocks, the trick is to “know when to get on [and more importantly] get off, the wave.”

Then, on Friday, October 24, at 2 p.m. ET, we’re going to do a comprehensive asset allocation and model portfolio review for paid-up annual members of the Grey Swan Investment Fraternity.

During the review session on Friday, we’ll be giving you access to an exclusive Plunge Protection Plan (for annual members only), including ways you can protect your money against a stock market correction and a few aggressive ways you can make money like the pros when the stock market goes down.

(Note: You still have time to subscribe and get the Plan on Friday. Click here for details.)

We’ll be providing more details throughout the week. But for now, mark your calendar for these two dates:

Thursday, October 23, 2025 @ 2 p.m. ET — comprehensive overview of the “terrifying bull market.”
Friday, October 24, 2025 @ 2 p.m. ET — a comprehensive review of the Grey Swan asset allocation strategy and model portfolio. (For paid up annual members only)

The time to prepare for a market correction is before it happens, not while or after. If you wait too long, the exits will get crowded in a hurry… and you don’t want to be worrying about your money if and when that happens.

If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

U.S. debt just topped $38 trillion for the first time.

It happened while the government was in “shutdown,” which really didn’t shut down much at all:

Turn Your Images On

Despite a shutdown which has put government spending on a partial pause, total U.S. debt has topped $38 trillion. (Source: FRED)

And it’s a trend that will continue higher, shutdown or not, thanks to the inexorable march of entitlement spending.

The debt is also helping inflate the stock market. Caveat emptor.

~ Addison

We’ll also lay out in simple terms the AI crash scenario. Mostly, so you’re aware of what’s at stake, where we think this market is going.

Then, on Friday, October 24, at 2 p.m. ET, we’re going to do a comprehensive asset allocation and model portfolio review for paid-up annual members of the Grey Swan Investment Fraternity.

(Note: You still have time to subscribe and get the Plan on Friday. Click here for details.)

We’ll be providing more details throughout the week. But for now, mark your calendar for these two dates:

Thursday, October 23, 2025 @ 2 p.m. ET — comprehensive overview of the “terrifying bull market.”
Friday, October 24, 2025 @ 2 p.m. ET — a comprehensive review of the Grey Swan asset allocation strategy and model portfolio. (For paid up annual members only)

If you have any questions for us about the market, send them our way now to: feedback@greyswanfraternity.com.

U.S. government debt is edging closer to the $38 trillion mark — now well over 120% of GDP. That puts the U.S. in the same league as basket-case economies like Venezuela, Sudan, and Lebanon. Not exactly the kind of company you want to keep.

But it makes sense: history shows that once a country crosses this threshold, things start to break — and it’s rarely just one thing. I’ve talked a lot about that in the past.

An admission: we’re mildly obsessed with the private credit markets.

When there’s a bull market in everything — AI stocks, financials, rare earths, gold and silver — it helps to keep an eye on the plumbing.

One chart tells the tale: since 2015, bank loans to non-depository financial institutions (NDFIs) — think private equity and private-credit funds — have soared nearly 300%.

Consumer loans, residential mortgages, commercial real estate? Flat as Kansas. Post-2008, Basel III and Dodd-Frank made leveraged and middle-market lending so capital-intensive that banks stepped back.

Gold dropped nearly 2% yesterday. But with the massive increase in fiat currencies globally, that’s an opportunity to buy more cheaply.

With that much cash sloshing around the system, the “debasement trade” is a go.

Trillions of dollars are already being transferred and tracked on the tokenized rails that Visa, JPMorgan, Mastercard and other major financial institutions plan to scale globally in the next 12 months.

Meaning, there’s no longer such a thing as “crypto vs. the banks.”

Because the same financial giants that crypto once tried to replace are taking the best parts of blockchain — speed, transparency and programmability — and fusing them into the system they already control.

And as each domino falls, it brings us closer to a world where money moves as easily as data.

It means that by the end of 2025, digital dollars could settle more value than PayPal ever has.

So if you’re still treating digital money as “the future,” you’re already a step behind.