What Practical Impact Does the National Debt Have?

What practical impact does the national debt have

Large amounts of government borrowing can "crowd out" private investment as exert upward pressure on interest rates. If the government borrows large amounts of money, there is less for everyone else, and interest rates tend to rise. Some private borrowers might not be able to afford the higher rates. Of course, many other factors besides deficits influence interest rates, such as the growth rate of the economy and expectations for inflation. SOURCE: Federal Reserve Bank of New York

National Debt Glossary

Looks up the key terms for understanding America's financial crisis

Frequently Asked Questions National Debt

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