/biz/ - Business & Finance

>>49779057
this leaves out an important point: the maturity death spiral.
>govt deficit spending
this used to be funded with a broad platter of UST issues, bills and bonds. for those that don't know, bills and bonds are the exact same instrument, but we use different words to refer to the very short duration (bills) vs. the very long duration (bonds) notes. we also sometimes use "notes" to refer only to bills, for whatever reason.
here's an old sample of the maturities; it's the best i can find quickly. the important thing to note here is that the % of the govt debt which is short duration has been hugely increasing. that means when the yield curve inverts, it is more and more painful to the US budget (not necessarily the economy... but yeah, the economy, because the govt is such a huge spender already). they take on new huge outlays to pay those rates, or, they simply cannot issue as many bills as before, which means programs get cuts.
some of you might not like to hear it, and i'm conservative too, but trump accelerated this process into its death spiral. hilary definitely would have done the same, if it's any consolation. but we are at the end now.
the fed is stuck monetizing all of it with single rounds of QE that are larger than all the previous QE rounds combined, every time, something like a fibonacci series (or a factorial function, when it reaches hyperinflation).
that or we just cut all of the spending, leave boomers sucking wind in their hospitals with no power, then start paying back the outstanding issues.