Morgan Stanley: $40 Trillion US Debt Will "Hit the Brakes" on Economy, but "No Crash" as Personal and Corporate Balance Sheets Remain Healthy

US debt has surpassed $40 trillion, yet Morgan Stanley offers a "no need to panic" assessment—corporate leverage has held steady for a decade, residential mortgages are locked in at historically low rates, and net worth continues to improve, forming a triple buffer against shocks. The real "breaking point" lies not in the debt itself, but in when bond yields begin to genuinely compete with equities. Should earnings growth decelerate, the vulnerability of US stocks would suddenly rise.