This photograph shows a television monitor broadcasting France's President Emmanuel Macron giving a speech from the Elysee Presidential Palace the day after riots and looting on the sidelines of nationwide protests against the "high cost of living", in Paris on October 18, 2026.

With a debt-to-GDP ratio of some 125%, this politically fractured country with an aging population and cost-of-living pressure faces tough choices neither its population nor its politicians are willing to tackle to put its perilous finances back in order.

That country sounds a lot like France - but actually, it's the United States.

Granted, the U.S. didn't just have riots leading to 2,400 arrests. France's leading supermarket chain, Carrefour (FR:CA), said 50 of its stores nationwide were looted and ransacked. The town hall in the city of Limoges was burned down.

France, in fact, has a slightly lower debt-to-GDP ratio than the U.S. The French budget deficit, projected to be 5.4% of GDP this year, is actually lower than the 6.1% of the U.S.

France can pay investors about 20 basis points less than the U.S. when it borrows over 10 years BX:TMBMKFR-10Y.

France is not even unique with student-led protests - with 26 of them popping up this year, from India to the U.S. "The scale varies, but they appear contagious," said Bilal Hafeez, a former strategist at Deutsche Bank and Nomura who now runs his own research service, Macro Hive. "Common threads that run through the protests are underspending in education and the resultant poor buildings and large class sizes, high tuition and accommodation costs and a loss of hope."

Hafeez referenced the six-stage framework on debt and world order put forward by Ray Dalio, the founder of hedge-fund giant Bridgewater Associates. "Paraphrasing: Stage 4 is spending and debt excess, Stage 5 is unmanageable debt and severe internal political polarization and class warfare and Stage 6 is breakdown and conflict, which includes the collapses of the rules-based system and the return of might is right. For what it's worth, he thinks we're at Stage 6."

For France in particular, the riots come just ahead of a scheduled review from Moody's, on Friday, which is unlikely to be favorable given the rating agency's current view of Europe's second-largest economy is one notch better than S&P or Fitch.

It also comes through as the French government tries to push a budget through the fractured parliament. Nico FitzRoy, senior Europe analyst at Signum Global, points out some paradoxical good news here - Marine Le Pen, who has proposed cutting the retirement age to 60, will want to project an image of security and stability, and so her party may be less likely to attempt to collapse the budget process.

France has some problems the U.S. does not. The first is that it has limited capacity to grow itself out of debt trouble - the French economy grew just 0.9% last year, and is projected by the International Monetary Fund to grow just 0.5% this year, vs. the 2.3% growth the U.S. enjoyed last year and is projected to see in both 2026 and 2027 by the same agency.

France's private sector is also heavily indebted. The combined household and nonfinancial corporate debt to GDP ratio is some 3 times, vs. about 1.5 for the U.S.

But the biggest difference may be the outsized U.S. role in financial markets.

"The dollar is the reserve currency of the world. More importantly, the entire global financial system functions on Treasurys," said Steve Eisman, an investor chronicled in The Big Short, on a weekend podcast in which he discussed the problems confronting France.

"The repo market, which is a multi-trillion dollar market for banks, only uses Treasurys. When large institutions want to park money, they buy Treasurys. Until there is a large, safe, and liquid alternative to Treasurys, the U.S. has the luxury of time. But not endless time."

-Steve Goldstein