In fact, the rising U.S. debt burden is one of the reasons why I continue to advise caution toward consumer sectors as well as why I have more modest expectations for long-term U.S. stock returns.
At a time when U.S. households are older and still struggling with slow wage growth, it would have been better had the country experienced a real deleveraging, rather than a cosmetic one.
Sources: Bloomberg, BlackRock Research
Russ Koesterich, CFA, is the Chief Investment Strategist for BlackRock and iShares Chief Global Investment Strategist. He is a regular contributor to The Blog and you can find more of his posts here.