Wharton Expert Warns Mounting US Debt Could Spike Interest Rates, Devastate Housing Market

• Joao Gomes, a Wharton finance professor, believes America's $34 trillion debt could cause interest rates to exceed 7% by 2025 if fiscal policies don't change • Gomes sees immediate and long-term threats to the economy if debt keeps mounting and no action is taken • Spiking interest rates could devastate the housing market by making homes unaffordable for many buyers • Gomes wants policy changes now but doubts politicians will make difficult, unpopular fiscal decisions before the next election • Failure to act could cause loss of confidence in US bonds, leading foreign investors to demand higher rates