Government borrowing binge could crowd out mortgages and investment

Commuters wait at a bus stop where there is a National Debt Clock billboard-sized running total display that shows the United States gross national debt as $105,866 per person in Washington, DC, on December 30, 2024. (Credit: Roberto Schmidt—AFP/Getty Images)

• Private investment could suffer as investors increasingly allocate funds to finance the government rather than firms and consumers, Apollo chief economist Torsten Sløk has warned. This phenomenon, known as crowding out, could become a bigger problem as the cost of servicing the $37 trillion in national debt increases. 

Wall Street seems increasingly antsy about how a ballooning federal deficit could weigh on both companies and consumers.