Remember Elon Musk’s warning that America will ‘1,000%’ go bankrupt? Well, US debt just soared through $40T

Remember Elon Musk’s warning that America will ‘1,000%’ go bankrupt? Well, US debt just soared through $40T Jing Pan Tue, September 1, 2026 at 1:15 PM GMT+2 8 min read TSLA Moneywise and Yahoo Finance LLC may earn commission or revenue through links in the content below. Elon Musk has been basking on his throne as the world's richest person, and largely based on the success of his U.

S. companies. But when it comes to America's fiscal health, his warnings have been apocalyptic, not complimentary.

"In the absence of AI and robotics, we're actually totally screwed because the national debt is piling up like crazy," the Tesla CEO told podcaster Dwarkesh Patel earlier this year. "We are 1,000% going to go bankrupt as a country, and fail as a country, without AI and robots. " Must Read Jeff Bezos backs a platform that lets anyone invest in rental homes for as little as $100 — 6 ways to build wealth like a landlord without actually being one JPMorgan sees gold hitting $5,000/oz by Q4 — and savvy investors are protecting their wealth with a tax-advantaged Gold IRA.

Get your free guide from Priority Gold The tax breaks in Trump's 'big beautiful bill' expire after 2028. Here are 4 moves to make before the window closes Now, the pile has reached a level America has never seen before. The U.

S. national debt has officially surged through $40 trillion (1) — more than double its level at the beginning of 2017. Roughly $32.

3 trillion is held by the public, while the remainder represents money owed to internal government accounts. Crossing a big round number does not mean the federal government is about to declare bankruptcy in the way a struggling business might. But the speed and scale of the increase make Musk's underlying concern harder to dismiss.

Republicans and Democrats alike have kept borrowing — pandemic relief, persistent deficits, rising spending and the snowballing cost of servicing debt already on the books. The federal government has run a roughly $1. 8 trillion deficit (2) so far in fiscal 2026 alone.

And debt has a way of feeding on itself. The more the government owes, the more interest it must pay. Those payments can require still more borrowing — particularly as older, cheaper debt is refinanced at higher rates.

The Congressional Budget Office (3) projects that federal net interest costs will reach $1. 0 trillion in 2026 and climb to $2. 1 trillion by 2036.

Over the same period, debt held by the public is projected to rise from 101% to 120% of gross domestic product — shattering the previous record set just after World War II. Here's the thing: For ordinary Americans, the danger isn't a $40 trillion bill showing up in the mailbox, but rather what it does to your money. Story Continues Ray Dalio, founder of the world's largest hedge fund, Bridgewater Associates, has warned that the U.

S. is heading toward a "debt death spiral," where the government must borrow simply to pay interest — a vicious self-reinforcing cycle. But unlike Musk, Dalio doesn't foresee a formal bankruptcy.

"There won't be a default — the central bank will come in and we'll print the money and buy it," he said. "And that's where there's the depreciation of money. " In other words, the government may never technically run out of dollars — but those dollars can lose value fast.

Musk has warned in the past that if current trends continue, "the dollar's going to be worth nothing. " That erosion in the value of the dollar is already visible. According to the Federal Reserve Bank of Minneapolis (4), $100 in 2025 has the same purchasing power as just $11.

61 did in 1970. That's right. $100 became less than $12.

The good news? Savvy investors have long found ways to protect their wealth — even when Washington's fiscal math stops adding up. Own something the Fed can't print To shock-proof your investments, Dalio emphasized the value of diversification and highlighted one time-tested asset in particular.

"People don't have, typically, an adequate amount of gold in their portfolio," he said. "When bad times come, gold is a very effective diversifier. " Gold has long been considered a go-to safe haven.

It can't be printed out of thin air like fiat money, and because it's not tied to any single currency or economy, investors often flock to it during periods of economic turmoil or geopolitical uncertainty, driving up its value. Over the past five years, as inflation continued to chip away at the purchasing power of the dollar, gold has climbed 144%. Other prominent voices see further potential.

JPMorgan CEO Jamie Dimon has said that in this environment, gold can "easily" rise to $10,000 an ounce. One way to invest in gold that can also provide significant tax advantages is to open a gold IRA with the help of Goldco . Gold IRAs allow investors to hold physical gold or gold-related assets within a retirement account, thereby combining the tax advantages of an IRA with the protective benefits of investing in gold , making it a compelling potential option for those wanting to ensure their retirement funds are diversified during rough economic times.

Goldco offers free shipping and access to a library of retirement resources. Plus, the company will match up to 10% of qualified purchases in free silver . If you're curious whether this is the right investment to diversify your portfolio, you can download your free gold and silver information guide today .

Just keep in mind that, most of the time, gold is best used as one part of an otherwise well-diversified portfolio. Read More: Millionaires under 43 hold only 32% of their wealth in stocks. Here's where their money is actually going An income-producing inflation shield But gold isn't the only asset investors turn to during inflationary times.

Real estate has also proven to be a powerful hedge. When inflation rises, property values often increase as well, reflecting the higher costs of materials, labor and land. At the same time, rental income tends to go up, providing landlords with a revenue stream that adjusts for inflation.

Over the past ten years, the S&P Cotality Case-Shiller U. S. National Home Price NSA Index (5) has jumped by 87%, reflecting strong demand and limited housing supply.

Of course, high home prices can make buying a home more challenging, especially with mortgage rates still elevated. And being a landlord isn't exactly hands-off work — managing tenants, maintenance and repairs can quickly eat into your time (and returns). No one wants passive income to turn into an active problem, after all.

The good news? You don't need to buy a property outright — or deal with leaky faucets — to invest in real estate today. Crowdfunding platforms like mogul offer an easier way to get exposure to this income-generating asset class.

As a real estate investment platform offering fractional ownership in blue-chip rental properties , mogul gives investors monthly rental income, real-time appreciation and tax benefits — without the need for a hefty down payment or midnight maintenance calls. Founded by former Goldman Sachs real estate investors , the team hand-picks the top 1% of single-family rental homes nationwide for you. In other words, you gain access to institutional-quality offerings for a fraction of the usual cost.

Each property undergoes a rigorous vetting process, requiring a minimum 12% return even in downside scenarios. Across the board, the platform features an average annual IRR of 18. 8%.

Offerings often sell out in under three hours , with investments typically ranging between $15,000 and $40,000 per property. Sign up for an account and browse available properties here to start investing today. And if you want to go all in on real estate, there are more options available — especially for those with capital on hand seeking to carve out multiple slices from the same vertical.

For instance, Lightstone DIRECT helps accredited investors access single-asset multifamily and industrial deals. Lightstone DIRECT's direct-to-investor model ensures a high degree of alignment between individual investors and a vertically-integrated, institutional owner-operator — a sophisticated and streamlined option for individual investors looking to diversify into private-market real estate. With Lightstone DIRECT, accredited individuals can access the same multifamily and industrial assets Lightstone pursues with its own capital, with minimum investments starting at $100,000.

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Article Sources We rely only on vetted sources and credible third-party reporting. For details, see our ethics and guidelines . Reuters ( 1 ); U.

S. Department of the Treasury ( 2 ); Congressional Budget Office ( 3 ); Federal Reserve Bank of Minneapolis ( 4 ); S&P Global ( 5 ) This article provides information only and should not be construed as advice. It is provided without warranty of any kind.