In 2023, several countries experienced sovereign defaults, primarily on local currency debt, including Argentina, Ghana, Liberia, Sri Lanka, and Suriname, totaling nearly $27 billion, with ongoing issues in Ghana and Sri Lanka driving much of this increase, adding to countries like Russia and Venezuela in default status for foreign currency debt.
Australia defaulted on its entire stock of domestic debt owed to bond and note holders. See Great Depression in Australia. Default only on domestic debt, not external debt.
The global economy has a long track record of nations defaulting on debt. Allegedly, Greece was the first in 377BC, while Spain has defaulted more times than any other: six times in the 1700s and seven times in the 1800s, but fortunately, not once since then.
There is no independent country that is completely debt-free. Having national debt is considered normal in modern economic systems. The country with the highest national debt is Japan. The United States is not a debt-free country.
Japan has the highest debt to GDP ratio, standing at 262%. This is followed by Venezuela at 241% and Greece at 193%.
Australia's government debt is nearing $1 trillion AUD in gross terms, with forecasts placing it just over that mark in late 2025 or early 2026, representing around 32-35% of GDP, which is considered relatively low compared to other developed nations despite rising from previous years. Net debt, which accounts for government assets, is lower (around $880 billion in 2024-25) but also growing as a percentage of GDP.
Eliminating the U.S. government's debt is a Herculean task that could take decades. In addition to obvious steps, such as hiking taxes and slashing spending, the government could take a number of other approaches, some of them unorthodox and even controversial.
About two-thirds of the national debt is held either by the government itself or by U.S. citizens.
🇺🇸 U.S. The United States continues to lead with $38.3 trillion in government debt, which accounts for just over one third of the global debt pile. China and Japan follow with $18.7 trillion and $9.8 trillion respectively, meaning the top three countries combined account for 60% of the world's debt.
The term 'Third World' refers to countries that are often characterized as poor, underdeveloped, or decolonized, primarily located in Africa, Asia, Latin America, and the Caribbean.
The Associated Press reported, in May 2023, that a dozen countries, including Pakistan, Kenya, Zambia, Laos and Mongolia, were on the "brink of collapse" under the weight of overwhelming foreign debt, "much of [it] from the world's biggest and most unforgiving government lender, China." However, the analysts quoted in ...
Since the United States has never defaulted on its obligations, the scope of the negative repercussions related to a default are unknown but would likely have catastrophic repercussions in the United States and in markets across the globe.
The United States owes the most money in absolute terms, with its national debt exceeding $38 trillion, making it the world's largest debtor by total dollar value. However, when debt is measured as a percentage of a country's economic output (GDP), countries like Japan, Sudan, or the United Kingdom often rank higher, showing significant debt relative to their economies. China also holds massive debt, both as a borrower and as the world's largest creditor through initiatives like the Belt and Road.
Yes, Australians are facing significant financial struggles in 2025, with high cost of living, rising debt, and widespread financial insecurity, particularly impacting young people, renters, and lower-income families, leading many to feel worse off and struggle to meet basic expenses despite some economic indicators improving. Key issues include affordability of essentials (food, housing), increased use of Buy Now Pay Later (BNPL), and a general sentiment that financial health isn't improving, say reports from Monash University, SBS News, The Salvation Army Australia, The West Australian, Agile Market Intelligence, ASIC, The Guardian, Broker Daily, and Australian Broadcasting Corporation.
Victoria currently has the highest total state debt in Australia in nominal terms, with projections showing it surpassing $194 billion, making it the most indebted state by absolute value and per capita, though the Northern Territory has the highest debt per person when population size is considered. Debt levels in Victoria are driven by significant infrastructure spending and past pandemic-related costs, leading to concerns about its financial position.
After 7 years (or 6 years, depending on the state/territory) of not paying a debt in Australia, it generally becomes "statute-barred," meaning creditors can't take new court action to recover it, but the debt itself might still exist (except in NSW, where the cause of action is extinguished). The clock restarts if you make a payment or acknowledge the debt in writing. Secured debts (like mortgages) have much longer timeframes (15 years).
Investors in Japan and China remain among the largest foreign holders of Treasury debt. Foreign ownership of U.S. debt can have implications for the nation's economy and financial markets.
As the world's biggest gambling hub, Macao SAR has zero debt, bolstered by billions in gaming revenue and healthy financial reserves. Liechtenstein ranks in second, with virtually no debt and the only country in Europe ranking in the top 10.
*Countries with the highest national per capita debt* (2025 estimates) 1. Japan $95,000: Debt > 250% of GDP, mostly domestic; aging population drives spending 2. United States $80,000: Debt > 130% of GDP 3. Italy $70,000: Debt 150% of GDP 4.
We have slower income growth, so we have fewer resources with which to pay our debt. Paul Solman: That is fewer tax revenues, which would mean borrowing even more. Plus, lower growth means less demand from businesses to borrow money for investment, which also tends to lower rates.
America owes China about $1 trillion dollars. Until we balance the US budget and pay down our debt, China's ownership of 7 percent of the national debt will continue to give it a vested interest in America's prosperity, not leverage to do us harm.
Buffett holds so much of his wealth in Treasury bills because they're easy to access. If he needs to cash out quickly and use the funds for something else, he can. They also offer high interest yields because the government rewards people for essentially loaning it money.
The phrase “Trump IRS forgiveness” is often used to describe speculative or proposed tax relief measures tied to Donald Trump's campaign promises or tax policies during his presidency. However: No legislation has been passed in 2025 to forgive IRS tax debt due to Trump's re-election campaign.
A feared recession didn't materialize, but unemployment rose, wage growth slowed and affordability challenges are mounting. After a chaotic year filled with trade wars, market gyrations and the longest government shutdown in history, the U.S. economy has, once again, proved more resilient than many forecasters feared.
Medical Bills
Unexpected medical expenses are one of the leading causes of debt in the U.S. Even with insurance, deductibles, co-pays, and out-of-pocket costs can quickly add up. A single accident, surgery, or extended hospital stay can lead to tens of thousands of dollars in bills.