President Donald Trump has suggested that the United States’ national debt, which exceeds $36 trillion, may be lower than officially reported due to fraud within the Treasury Department. Speaking aboard Air Force One, he claimed that irregularities identified by his administration and an efficiency team led by Elon Musk could mean some of the reported debt figures are inaccurate.
The remarks, however, lacked specificity, leaving economists and analysts uncertain about their implications. Financial markets have largely dismissed the statement, focusing instead on economic indicators and the Federal Reserve’s interest rate policy. Experts stress that any material changes to the debt structure would require detailed verification, something yet to be provided.
Unclear claims about fraudulent Treasury figures
During his remarks, Trump did not specify whether he was referring to debt held by the public or obligations related to government trust funds, such as Social Security and Medicare. “We’re even looking at Treasuries,” Trump said, suggesting that some of the reported debt figures “don’t count” due to fraudulent records.
His comments have raised questions but provided no concrete evidence. Maria Vassalou, head of the Pictet Research Institute, told Fox Business that Trump’s claim was “virtually impossible” to apply to publicly held debt, as it is closely monitored by financial institutions. Instead, she suggested his remarks “most likely refer” to the portion of the debt held in government accounts, such as trust funds.
Martin Whetton, head of financial markets strategy at Westpac in Sydney, dismissed the impact of Trump’s claim, stating that it was “meaningless until clarified”. Given the scale of $35 trillion in public debt, Whetton noted that financial markets have chosen to ignore the remarks and focus instead on broader economic trends.
Market reaction and economic outlook
Despite the ambiguity surrounding Trump’s statement, financial markets have remained steady, with investors directing their attention to economic indicators and Federal Reserve policy decisions. The latest Labour Department report showed the US economy added 143,000 jobs in January, falling short of the 170,000 jobs expected by LSEG economists.
Following the data release, the probability of the Federal Reserve leaving interest rates unchanged at its March meeting rose from 86% to over 91%, according to the CME FedWatch Tool. Analysts suggest that interest rate cuts remain the primary concern for markets, rather than speculation over the structure of national debt.
