The federal government has burned through nearly $1.4 trillion in borrowed money during the first nine months of fiscal year 2026, averaging $155 billion a month in new debt issuance while simultaneously writing interest checks that now top $23.8 billion every single week. The numbers, drawn from the Congressional Budget Office’s latest monthly budget review, describe a fiscal trajectory that no amount of growth optimism or spending-cut rhetoric has managed to bend.

Net interest on the national debt has become the fastest-growing line item in the federal budget, rising 13% year over year and now exceeding the combined spending of seven major federal departments. For gold investors, the arithmetic is simple: a government that must borrow $39 billion a week just to keep the lights on has fewer and fewer exits that do not involve some form of currency debasement.

The CBO’s review, reported by Fortune, puts the nine-month deficit for fiscal 2026 at just under $1.4 trillion, up from just over $1.3 trillion during the same stretch of fiscal 2025. Total national debt now stands at $39.4 trillion. The interest bill alone has hit $857 billion through the first three quarters of the fiscal year, roughly $100 billion more than the same period a year earlier.

Interest Payments Now Dwarf Entire Departments

One comparison in the CBO data lands harder than any abstract percentage. The $857 billion in net interest paid so far this fiscal year exceeds the combined outlays of the Departments of Defense, Commerce, Homeland Security, and Education, plus the Environmental Protection Agency, the Small Business Administration, and the remnants of the Coronavirus Refundable Credits program. It exceeds them by $20 billion.

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That is not a projection or a worst-case scenario; it is the current run rate. The federal government is now spending more to service past borrowing than it spends to defend the country, educate its children, and secure its borders, combined.

The CBO attributes the 13% year-over-year jump in interest costs to two forces: a larger outstanding debt stock than a year ago, and higher long-term interest rates. Neither factor shows signs of reversing. As we noted in our coverage of Treasury yields putting the $39 trillion debt on a collision course, elevated rates do not merely raise borrowing costs at the margin. They compound through the entire stock of maturing and rolling debt, creating a self-reinforcing fiscal drag.

Entitlements: The Structural Engine

Interest is the headline grabber, but the entitlement complex is the structural engine underneath. The CBO reported that Social Security spending rose $62 billion, or 5%, driven by increases in both average benefits and the number of beneficiaries. Medicare outlays climbed $58 billion, an 8% jump, on higher enrollment and higher payment rates for services. Medicaid spending increased $49 billion, or 10%, because of rising costs per enrollee.

Together, those three programs added $169 billion in new spending in just nine months. That is more than a billion dollars a day in incremental entitlement costs, before a single new policy is enacted.

The demographic math behind those numbers is not improving. U.S. Census Bureau data cited in the report shows the national median age ticked up from 39.2 in 2024 to 39.4 in 2025. The ratio of males per 100 females among those 65 and older has risen from 70.6 in 2001 to 81.6 in 2025, meaning more men are surviving into the age brackets that draw the heaviest benefits. An aging population does not negotiate. It simply draws on the programs it was promised.

The Longer-Term CBO Outlook Is Worse

The monthly budget review captures the current fiscal year. The CBO’s broader projections, released earlier in 2026, paint an even grimmer picture. Newsmax reported that the CBO projects the fiscal 2026 deficit will grow to $1.853 trillion, roughly 5.8% of GDP, with the deficit-to-GDP ratio averaging 6.1% over the next decade. That is roughly double Treasury Secretary Scott Bessent’s stated target of reducing the deficit to 3% of GDP.

Public debt held by the public is projected to reach $56.152 trillion, or 120% of GDP, by 2036, surpassing the post-World War II peak of 106% as early as fiscal 2030. Net interest costs on federal debt are set to more than double to $2 trillion by fiscal 2035. The “One Big Beautiful Bill,” the administration’s signature legislative package, is projected to add $4.7 trillion to deficits over ten years.

Jonathan Burks of the Bipartisan Policy Center offered a blunt assessment:

“There’s no sugar-coating it: America’s fiscal health is increasingly dire. Our debt is now 100% of GDP, and rather than pumping the brakes, we are accelerating. These large deficits are unprecedented for a growing, peacetime economy.”

CBO Director Phillip Swagel reinforced the point, noting that “those sustained large deficits are historically unusual, given that the unemployment rate is projected to remain below 5%.” In other words, this is not crisis spending; it is structural overshoot during what Washington still classifies as good times.

Tariffs, Revenue, and the Inflation Feedback Loop

AP News reported that the CBO’s ten-year outlook shows debt held by the public rising from 101% to 120% of GDP by 2036, with total deficits from 2026 to 2035 running $1.4 trillion larger than previously projected. Higher tariffs are expected to raise roughly $3 trillion in federal revenue over the period, but the CBO also flagged that those same tariffs will drive higher inflation from 2026 to 2029.

That creates a feedback loop that metals investors should watch carefully. Tariff-driven inflation pushes up the cost of entitlement programs indexed to prices. It also keeps long-term interest rates elevated, which in turn raises the government’s borrowing costs. Revenue gains from tariffs may be partially or fully offset by the higher spending they help trigger. The background we covered in our analysis of bond market inflation warnings and tripling debt costs illustrates how this dynamic has already been building for years.

Michael Peterson, CEO of the Peterson Foundation, framed the political dimension: “This election year, voters understand the connection between rising debt and their personal economic condition. And the financial markets are watching.”

What the Markets Are Watching

The fiscal trajectory matters to gold and silver investors for reasons that go beyond inflation hedging. A government borrowing $39 billion a week must constantly find buyers for its paper. When the debt stock grows faster than the pool of willing creditors, something has to give: either rates rise to attract buyers, or the central bank steps in to absorb supply, or the currency adjusts, or some combination of all three.

Each of those outcomes tends to be constructive for hard assets. Higher real rates can suppress gold temporarily, but they also tighten financial conditions and raise the odds of a credit event or recession that eventually forces the Fed back toward accommodation. Central bank absorption of Treasury supply is, by definition, monetary expansion. And currency adjustment is simply another way of saying that gold’s price in dollars goes up.

Warren Buffett, speaking at Berkshire Hathaway’s 2024 annual shareholder meeting, offered a similar read on the endgame. “I think higher taxes are likely,” he said, as the New York Post reported at the time. The IMF, for its part, warned that U.S. spending is “out of line with what is needed for long-term fiscal stability” and that ballooning debt threatens to exacerbate inflation and pose risks to the global economy.

Whether the resolution comes through taxes, inflation, financial repression, or outright restructuring, every plausible path involves some erosion of the dollar’s purchasing power. The question is speed and severity, not direction. As we explored in our report on U.S. debt hitting $39 trillion, the milestones keep arriving faster than the political system’s ability to respond to them.

The Structural Bind

The core problem is not any single policy or any single administration. It is the structural bind created by decades of compounding commitments. Entitlement spending is driven by demographics that no election can reverse. Interest costs are driven by a debt stock that no realistic growth rate can outrun. And the political incentive structure rewards promising more, not less.

The CBO’s own earlier projections, as the Washington Free Beacon detailed, showed government outlays growing at 5% per year on average while revenues grow at only 4%. That 100-basis-point gap, compounded over a decade, is the arithmetic definition of a fiscal spiral. Former CBO Director Keith Hall, recalling his 2015-2019 tenure leading the agency, put it plainly: “The debt is now significantly higher. It’s about 77 percent of GDP. It’s a very high level. In, say, 2007 that number was something like 37 percent of GDP. So debt has essentially doubled.”

Those numbers have only worsened since Hall made that observation. The debt-to-GDP ratio has since blown past 100%.

What This Means for Metals Portfolios

Gold does not need a crisis to perform well in this environment. It needs exactly what the CBO data confirms: a government that cannot stop borrowing, a debt stock that compounds faster than the economy grows, and a political system that lacks the will or the mechanism to impose discipline. The trend in global debt and investor drift from U.S. Treasuries reinforces the same point from the demand side of the bond market.

For readers holding physical gold and silver, the fiscal data is less a trading signal than a confirmation of the regime they are already positioned for. The key variables to watch are:

  • Whether long-term Treasury yields continue to reflect the growing supply of government paper or get suppressed through intervention
  • Whether the Fed is eventually forced to accommodate fiscal deficits through balance-sheet expansion, even if it does not call it quantitative easing
  • Whether foreign central banks continue diversifying reserves away from dollar-denominated assets
  • Whether the tariff-inflation feedback loop accelerates entitlement cost growth beyond current CBO projections

None of these questions have clean answers yet. But the direction of the fiscal trajectory is not ambiguous. Washington is borrowing $155 billion a month, paying $24 billion a week in interest, and adding to both totals every quarter.

When the cost of servicing yesterday’s promises exceeds the cost of defending the country today, the monetary regime is telling you something about what comes next. Gold has been listening.