Debt Settled in Discounted Bucks, a Trillion-Dollar Diet, and a 2008 Sequel – Gromen’s Gloomy Outlook

Luke Gromen, the founder of FFTT and a former Cleveland Research partner, just delivered a bleak, chart-packed presentation on the U.S. fiscal situation. Think of it as the bearish alpha you didn't want but probably need.

Debt will be paid, just in cheaper dollars – Gromen's thesis is simple: the U.S. will honor its debts on paper, but the currency used will be the monetary equivalent of a shitcoin in a perpetual downtrend. You'll get your principal back, but its purchasing power will have been rugged.

A 2008‑style prelude – He suggests the current macro vibe is a direct sequel to the months before the 2008 crash, proposing that February 2026 might one day be remembered as "the new July 2007." Get ready for the prequel memes.

AI won’t steal all white‑collar jobs, leverage will – Forget Skynet; the real job destroyer is old-fashioned, systemic leverage. Gromen argues that while AI will automate some roles, financial over-extension will be the main character in this economic horror story.

U.S. budget anatomy – Federal revenues are about $5.2 trillion a year. A cool 70% of that gets auto-sent to entitlement programs (mostly for boomers), and another 30% is instantly vaporized by interest on the national debt. This leaves almost nothing for anything else, like, say, functioning government services.

The trillion‑dollar haircut – To even pretend to balance the budget, Gromen says D.C. needs to cut about $1 trillion in spending—roughly 3% of GDP. That's not a trim; that's a full-head shave with fiscal clippers, and it's going to sting.

Paradox of austerity – Here's the kicker: slashing spending could actually make the deficit-to-GDP ratio worse. Less government spending could slow the economy, crush tax revenue, and potentially trigger an equity market sell-off. It's the fiscal version of "doing more damage while trying to heal."

Politics beats math – Gromen contends that the political drama from such cuts will completely overshadow the boring spreadsheet math. The narrative will be louder than the numbers, as usual.

Crisis escalation – His view is we're already in a financial crisis, and it's now strolling confidently toward a full-blown panic phase, fueled by a widespread "I can't afford anything" vibe across Western economies.

Japan’s warning lights – Japan's bond market has been flashing warning signs since the second half of last year, a clear signal that this financial stress isn't a U.S.-only feature. It's a global beta release.

Yen dynamics – The yen has been pumping as the yield spread between 10-year U.S. Treasuries and Japanese Government Bonds narrows. Japanese investors are taking profits and bringing capital back home, a classic "de-risking" move when the yield play gets less attractive.

In summary, Gromen sketches a future where a debt-saturated U.S. repays its obligations with increasingly devalued dollars, requires a politically impossible trillion-dollar spending cut, and faces down a crisis that smells a lot like 2008, all while global bond markets and currency flows add extra layers of complexity to the impending doom.