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With a Global Average of 110% of GDP, AUVP Capital Study Warns That Debt Burden Threatens Economic Stability and Pressures Interest Rates in Various Economies.
The global debt reached historic levels in 2025, surpassing US$ 324 trillion. The United States alone accounts for US$ 37 trillion, while Japan maintains a debt level equivalent to 235% of its Gross Domestic Product (GDP).
According to a report by AUVP Capital, the global average is now around 110% of GDP, indicating that the problem is not isolated.
This escalation directly impacts public bonds, pension funds, and nations’ investment capacity, creating an environment of uncertainty for governments and citizens.
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The Portrait of Global Debt
According to the report, indebtedness is no longer a topic restricted to economists and now impacts the daily lives of families.
Today, each newborn on the planet “inherits” an average of US$ 40,000 in debt, reflecting the sum of annual production and the commitments made by governments.
In the United States, the fiscal deficit is above 6% of GDP, forcing successive bond issuances.
In Japan, the problem is structural: the aging population pressures social spending and keeps the debt at a record level of 235% of GDP.
The Logic of Debt Cycles
The study notes that the current trajectory repeats cycles already seen. After World War II, countries faced high levels of debt but managed to reduce them during the accelerated growth period between 1950 and 1980.
From the 1980s onward, falling interest rates facilitated cheap credit and encouraged governments to take on even more debt.
With the 2020 pandemic and interest rates near zero, the cost of debt exploded. Today, many countries spend more on interest than on social investments or infrastructure.
The Impact on Financial Markets
The report highlights that the increase in debt is already pressuring the bond market. Extreme examples come from Austria, where 100-year bonds have lost 75% of their value since 2020.
In the United States, ETFs like TLT, which reflect long-term bonds, have accumulated losses of nearly 50% over five years.
This scenario has undermined international confidence. Central banks now hold more reserves in gold than in U.S. Treasuries, something unprecedented since the 1990s.
The search for assets considered safe, such as gold, silver, and even Bitcoin, reflects the perception that the system based on increasing debt issuance may have reached its limit.
Consequences for Citizens and Governments
In practice, the escalation of debt means higher interest rates, restricted credit, and the risk of persistent inflation. For the average citizen, this translates into more difficulty financing the purchase of homes, cars, and even maintaining purchasing power.
Governments, in turn, face a dilemma: raise taxes, cut spending, or continue issuing bonds.
None of these choices definitively solve the debt problem, and all have significant social and political impacts.
Possible Scenarios
The analysis outlines three possible scenarios: a prolonged recession, an inflationary wave similar to that of 2008, or a crisis of confidence in U.S. public bonds.
Pension funds, which concentrate investments in long-term bonds, could be the most affected, jeopardizing the retirement of millions.
Still, assets like gold and silver have served as a “safe haven” amid turmoil, appreciating over 30% just in 2025.
The global debt has reached a point where it compromises not only public finances but also the daily lives of citizens and businesses.
For AUVP Capital, the system only endures through investor confidence, but signs of wear are accumulating rapidly.
In your opinion, who should foot this bill? Governments, with fiscal adjustments, or the population, with higher taxes and fewer benefits?
Leave your thoughts in the comments; we want to hear from those living this in practice.
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