US Debt Approaches $40 Trillion: Risks for DACH Investors

US national debt reaches approximately $40 trillion on August 19, 2026. Within two years, the debt pile has grown by about $2.7 trillion – from $36.2 trillion in fiscal year 2024 to just under $40 trillion today. The market for US Treasury securities has more than sevenfold since 2007: from $4.5 trillion to over $31 trillion.

Debt Growing by $8 Billion – Per Day

The debt clock runs unchecked. Every second adds $25,178, averaging $8 billion per day. In the first year of Donald Trump's second term (2025–2026), debt grew by $2.25 trillion – the fastest growth rate outside the pandemic. For comparison: in Trump's first term (2017–2021), debt rose by more than $8 trillion, and under Joe Biden through end of 2025 by around $7 trillion.

Per capita debt stands at approximately $114,575 to $117,000 per resident – excluding private liabilities. With around 343 million inhabitants, the debt pile is distributed across a growing population, yet the absolute burden rises faster than economic output.

One Trillion Dollar in Interest Costs – Every Fifth Tax Dollar Goes to Creditors

In 2026, the US pays approximately $1 trillion solely for debt service. This sum exceeds both the entire defense budget and spending on Medicaid, the state health program. Mathematically, every fifth tax dollar collected flows to creditors instead of infrastructure, education, or defense. Monthly interest costs amount to approximately $88 billion.

The main drivers of debt are, in addition to interest costs, massive military spending, stimulus programs, and international conflicts. Alone in connection with the Iran conflict, $200 billion in new costs are cited. The interest burden exceeded $1 trillion per year for the first time in 2025.

Who Holds the $40 Trillion?

The creditor structure shows: the US finances itself predominantly domestically. According to data from the US Treasury Department, the Federal Reserve, and the Joint Economic Committee from March 19, 2026, domestic creditors hold approximately $30 trillion – around 77 percent of total debt. Foreign investors own less than a quarter, approximately $9 trillion.

The largest single holder among domestic creditors are investment funds and pension funds with $6.6 trillion. The Federal Reserve holds $4.4 trillion – more than the three largest foreign creditors Japan, the United Kingdom, and China combined. The so-called intragovernmental debt, obligations of the state to the social security system, amounts to approximately $7.6 trillion.

Among foreign creditors, Japan leads the list, followed by the United Kingdom and China. The largest private individual holder is Warren Buffett: his holding company Berkshire Hathaway held a total of $339 billion in US Treasury securities in the fourth quarter of 2025.

Debt-to-GDP Ratio at 125 Percent – International Comparison

Measured against annual economic output, US national debt stands at around 125 percent. In international comparison, this is high but not an extreme outlier. Japan leads the ranking of major economies with approximately 204 percent. Several European countries also exceed the US level.

A crucial difference: the US borrows in its own currency, the US dollar, which it issues itself. The dollar remains the dominant reserve currency with around 58 percent of global currency reserves. An equivalent alternative is not in sight. Countries like Japan demonstrate that a debt-to-GDP ratio above 100 percent can be sustainable over decades without a country becoming insolvent.

Warnings and Risks for Investors

Former US Treasury Secretary Henry Paulson warned in April 2026 of a dangerous loss of control in the bond market with potentially fatal consequences. Warnings of a "debt endgame" have existed for decades without materializing. Experts disagree on the specific impacts that continuously growing government debt will have.

Structural factors cushion the burden: a large portion of debt is held domestically, the dollar dominates global currency reserves, and the US issues the currency itself. Nevertheless, dependence on low interest rates increases. Even moderate interest rate increases significantly raise the debt burden.

Diversification with Gold – What Experts Recommend

Many capital market experts recommend investing 5–15 percent of your portfolio in physical gold to mitigate systemic risks. Gold serves as a store of value and inflation protection in times of crisis. The recommendation is particularly directed at investors seeking diversification outside the dollar system.

For DACH investors, US national debt remains relevant: US Treasury securities are included in many international funds and ETFs. The development of interest rates and debt-to-GDP ratio affects returns on bond portfolios but also valuations of stocks and alternative investments. The Statista forecast for 2026 was approximately $40.73 trillion – a figure that has now been reached.

Whether debt remains sustainable long-term depends on creditor confidence. As long as the dollar remains unchallenged as a reserve currency and investors view US Treasury securities as a safe haven, the system remains stable. The question is how long these preconditions will hold.