Long-term bond investors are increasingly reluctant to lend to the U.S. government, possibly due to its excessive borrowing. Despite facing significant market losses, political discussions continue to focus on further debt-driven spending. The 10-year U.S. Treasury yield recently reached 4.9%, the highest since 2007, as the Treasury Department increases its borrowing. After the 2008 crisis, global governments, including the U.S., lowered interest rates, sometimes even going negative. This historically unprecedented situation led to massive debt accumulations. With rising interest rates, the U.S. now faces potential interest costs of over $13 trillion in the next decade.
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Government Bubble Bust: Treasury Bond Investors Have Been Taking a Historic Beating
Long-term bond investors are increasingly reluctant to lend to the U.S. government, possibly due to its excessive borrowing. Despite facing significant market losses, political discussions continue to focus on further debt-driven spending. The 10-year U.S. Treasury yield recently reached 4.9%, the highest since 2007, as the Treasury Department increases its borrowing. After the 2008 crisis, global governments, including the U.S., lowered interest rates, sometimes even going negative. This historically unprecedented situation led to massive debt accumulations. With rising interest rates, the U.S. now faces potential interest costs of over $13 trillion in the next decade.
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