The co-founder of Home Depot has issued a dire warning about the state of the US economy.
Ken Langone, one of the founders of the DIY giant in 1978, expressed concern that US debt is getting out of hand and represents a ‘scary’ signal about the economy’s condition.
‘Look at the amount of debt we raise every year,’ Langone told Fox Business.
‘What is it today? Thirty-six, thirty-seven [trillion dollars], going up a trillion a year in interest alone. That’s scary,’ he told the outlet.
The billionaire expressed his hope that Washington would listen to his warning about the necessity of being aware of the significance of the US’s status in the global economy and markets.
‘If we fritter that away, we’re in trouble,’ the 89-year-old said.
‘Four weeks ago, we struggled to issue a 20-year bond. They were not receptive. This is a troubling indication. It’s just the start,’ Langone stated, referring to the recent challenges within the bond market.
The Treasury bond market has been rattled in recent weeks due to Trump’s tariff policies and concerns over the effect of the administration’s sweeping tax bill on ballooning government debt.
Ken Langone warned that US debt is spiraling
US government bonds have traditionally been seen as one of the world’s safest assets, as well as a place where investors can park their money in times of volatility.
However, investors are looking upon treasury bonds less favorably and ratings agencies have even downgraded the US’s credit rating.
‘That should make us say, “Hey, wait a minute.” When the integrity of our debt is subject to question, the next thing is your currency,’ Langone added.
‘I do think it’s time to get some balance here.’
The GOP megadonor, who once backed Trump, previously savaged the President’s tariff policies as ‘b******t.’
Langone criticized the scope and timing of Trump’s tariff announcement that triggered a market collapse, claiming the President was poorly advised and his math did not make sense.
‘I don’t understand the goddamn formula,’ Langone, who supported Trump in 2016 and has a net worth of $8.4 billion, told The Financial Times in April.
‘I believe [Trump’s] been poorly advised by his advisers about this trade situation — and the formula they’re applying.’
Langone co-founded the DIY giant Home Depot in 1978
The Treasury bond market has been rattled in recent weeks due to Trump’s tariff policies
Langone said the escalating geopolitical situation in the Middle East is adding fuel to the fire.
‘We’ve now got this Iranian thing to go along with tariffs,’ Langone said on Tuesday.
‘I think people are getting cautious. And the facts and numbers that came out today indicated that things are slowing,’ the businessman said, referring to weak sales and manufacturing data.
It comes as the Federal Reserve also expressed caution about the economy by holding interest rates steady at its latest meeting on Wednesday.
Federal Reserve chair Jerome Powell said the full effect of Trump’s trade policies have not yet become clear, but that he expects they will drive up prices.
The central bank held the benchmark rate steady between 4.25 and 4.5 percent, but officials said they expect to cut rates twice before the end of the year.
Trump lashed out at Powell following the announcement.
The President wrote on his social media site Truth Social on Thursday: ‘”Too Late” Jerome Powell is costing our Country Hundreds of Billions of Dollars. He is truly one of the dumbest, and most destructive, people in Government, and the Fed Board is complicit.
‘Europe has had 10 cuts, we have had none. We should be 2.5 Points lower, and save $BILLIONS on all of Biden’s Short Term Debt. We have LOW inflation! TOO LATE’s an American Disgrace!’
