Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street • Hacker News Board

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#11

Post by mindslight » Thu, May 22, 2025, 2:16 AM UTC

suraci wrote: post #10

nemothekid wrote: post #6

Earlier quoted context omitted.

> Does anyone else have the sickening feeling that their actual plan is to straight up destroy USD Stephen Miran, the chair of the Council of Economic Advisers under Trump, is pretty much trying to do this. He published 'A User's Guide to Restructuring the Global Trading System', and it pretty much outlines why they should destroy the USD - in order to bring manufacturing home, so that the warhawks will no longer hav…

I like Stephen Miran, I always like people who are (relatively) honest > CEA Chairman Steve Miran Hudson Institute Event Remarks https://www.whitehouse.gov/briefings-statements/2025/04/cea-...

It's a bit of a stretch to call this juxtaposition of topics, with absolutely zero analysis of how they're connected, honest:

> we tax hardworking Americans mightily to finance global security. On the financial side, the reserve function of the dollar has caused persistent currency distortions and contributed, along with other countries’ unfair barriers to trade, to unsustainable trade deficits.

Money is fungible between these two concerns. The excess demand for USD is a source of revenue for our economic empire, realized by the continual monetary inflation without nearly as much corresponding price inflation. Some of that monetary inflation has been used by the government (~"deficit spending"), but the sheer majority has been getting dumped into the financial industry to bid up existing assets as a handout to the rich. That is what has left the American worker high and dry - near complete inability for the US government to use that already-centralized revenue to help wider society, due to a political movement based around fake austerity.

The article continues on using the passive voice to describe multiple things that the US government could have put a stop to any time it wanted, framed as if they were being done to us by other countries. For example:

> in the years running up to the 2008 crash, China along with many foreign financial institutions, increased their holdings of U.S. mortgage debt, which helped fuel the housing bubble, forcing hundreds of billions of dollars of credit into the housing sector without regard as to whether the investments made sense

Obviously if the government had set interest rates higher rather than lower, there would have been fewer mortgage bonds to buy and the dollars would have had to go elsewhere. I don't know if this pattern is deliberate or just an inevitable result of the bizzarro framing where having the world reserve currency is asserted to be a liability, but either way it is most certainly not honest.

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#12

Post by jameslk » Thu, May 22, 2025, 2:35 AM UTC

mindslight wrote: post #4

Does anyone else have the sickening feeling that their actual plan is to straight up destroy USD, with the looters fleeing to hard assets and foreign/crypto currency, and the plebs' currency crisis then serving as the justification for naked fascism red in tooth and claw? With the narrative then shifting to the usual "Democrats did this! And we tried to stop it but we were too late!" nonsense, backed up by an army of…

This present issue has been caused by decades of bad fiscal policy by both parties:

https://fred.stlouisfed.org/series/GFDEGDQ188S

Here for example, the Congressional Budget Office, forecasted federal debt as a percent of GDP would continue to rise unchecked, back in 2023: https://www.cbo.gov/publication/59014

The only presidential politician who sounded the alarm was Ross Perot, all the way back in the 90s.

Lyn Alden has been talking about this for a long time. If you want a good intro to the problem, I’d recommend this article of hers:

https://www.lynalden.com/september-2024-newsletter/

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#13

Post by sorcerer-mar » Thu, May 22, 2025, 2:48 AM UTC

mindslight wrote: post #4

Does anyone else have the sickening feeling that their actual plan is to straight up destroy USD, with the looters fleeing to hard assets and foreign/crypto currency, and the plebs' currency crisis then serving as the justification for naked fascism red in tooth and claw? With the narrative then shifting to the usual "Democrats did this! And we tried to stop it but we were too late!" nonsense, backed up by an army of…

They make a lot of sense if you consider that the man up top is an actual stupid person and he is surrounded by sycophants. He has suggested for decades that he understands trade deficits to be identical to subsidies. He prefers mob-boss dynamics as opposed to mutual alliances. He legitimately thinks he can engineer a market economy's prices with his closed-door meetings with CEO buddies.

It is gobsmackingly dumb, but remember we have no evidence of him being anything other than gobsmackingly dumb. It's a very parsimonious explanation of everything he does.

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#14

Post by mindslight » Thu, May 22, 2025, 2:54 AM UTC

jameslk wrote: post #12

mindslight wrote: post #4

Does anyone else have the sickening feeling that their actual plan is to straight up destroy USD, with the looters fleeing to hard assets and foreign/crypto currency, and the plebs' currency crisis then serving as the justification for naked fascism red in tooth and claw? With the narrative then shifting to the usual "Democrats did this! And we tried to stop it but we were too late!" nonsense, backed up by an army of…

This present issue has been caused by decades of bad fiscal policy by both parties: https://fred.stlouisfed.org/series/GFDEGDQ188S Here for example, the Congressional Budget Office, forecasted federal debt as a percent of GDP would continue to rise unchecked, back in 2023 : https://www.cbo.gov/publication/59014 The only presidential politician who sounded the alarm was Ross Perot, all the way back in the 90s. Lyn Ald…

> This present issue has been caused by decades of bad fiscal policy by both parties

So I completely agree with this statement, but I completely disagree with the metric you've chosen to illustrate it.

"National debt" only exists due to the martingale of the Federal Reserve neutering the government's own monetary sovereignty. If we need to have an inflationary currency, then the new money should be spent by Congress on deliberate public goals - it's another tax.

You can tell "national debt" is a dodgy metric because it combines two very different things into one scary-in-the-context-of-household-finances thing. The portion of "the debt" that is Treasuries held by the Federal Reserve is the lesser bit of monetary creation that was actually spent for public goals, in spite of the fake "fiscal responsibility" narrative. It is moot as far as debt goes - nothing actually happens if it compounds to infinity.

The other portion of "the debt" that is held by private/foreign owners is the government functioning as a bank account of last resort, and could very well just be at the central bank instead.

What we currently have is a dog and pony show to pretend that we don't have this centralized fountain of money, in order for the financial industry to keep getting the first cut of low interest loans (which have mostly gone into bidding up the asset bubbles).

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#15

Post by hedora » Thu, May 22, 2025, 3:01 AM UTC

jameslk wrote: post #12

mindslight wrote: post #4

Does anyone else have the sickening feeling that their actual plan is to straight up destroy USD, with the looters fleeing to hard assets and foreign/crypto currency, and the plebs' currency crisis then serving as the justification for naked fascism red in tooth and claw? With the narrative then shifting to the usual "Democrats did this! And we tried to stop it but we were too late!" nonsense, backed up by an army of…

This present issue has been caused by decades of bad fiscal policy by both parties: https://fred.stlouisfed.org/series/GFDEGDQ188S Here for example, the Congressional Budget Office, forecasted federal debt as a percent of GDP would continue to rise unchecked, back in 2023 : https://www.cbo.gov/publication/59014 The only presidential politician who sounded the alarm was Ross Perot, all the way back in the 90s. Lyn Ald…

Clinton balanced the budget back in the 90’s. Biden and Obama’s terms were almost entirely defined by picking up economic disasters the previous administration caused. (2009 marked the beginning of the housing crisis, bank defaults due to deregulation and occupy wall street. 2021 was mid pandemic, after Trump spent years printing money with his zero interest rate stuff and tax cuts. He also fired the US funded team that China relied on for early pandemic detection and response.)

So, claiming this problem is bipartisan is nonsense. I’ll blame the dems for lots of stuff, but wildly inflationary fiscal policies and intentionally destructive economic policies aren’t on the list.

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#16

Post by platevoltage » Thu, May 22, 2025, 3:02 AM UTC

sorcerer-mar wrote: post #13

mindslight wrote: post #4

Does anyone else have the sickening feeling that their actual plan is to straight up destroy USD, with the looters fleeing to hard assets and foreign/crypto currency, and the plebs' currency crisis then serving as the justification for naked fascism red in tooth and claw? With the narrative then shifting to the usual "Democrats did this! And we tried to stop it but we were too late!" nonsense, backed up by an army of…

They make a lot of sense if you consider that the man up top is an actual stupid person and he is surrounded by sycophants. He has suggested for decades that he understands trade deficits to be identical to subsidies. He prefers mob-boss dynamics as opposed to mutual alliances. He legitimately thinks he can engineer a market economy's prices with his closed-door meetings with CEO buddies. It is gobsmackingly dumb, bu…

I mean, being born rich makes it way easier to fail upwards.

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#17

Post by hedora » Thu, May 22, 2025, 3:03 AM UTC

hshdhdhj4444 wrote: post #8

ty6853 wrote: post #5

Earlier quoted context omitted.

Anyone with 0.1% of a brain switched to hard assets during the COVID ~0% money printing mania.

And they would have lost a record increase in U.S. assets across the board, including the US dollar, which should have gone down if the problem was money printing. It’s rare to have such a clearly evident case of cause and effect. We know why yields are going up. Because investors don’t believe the U.S. government can control their budget deficits. The recent rising yields have little to do with money printing from 4…

Also, 0% interest was a thing for years before covid. It was pretty much the entire trump administration.

(Back then, we bet on unprecedented inflation, and that’s been working out great so far.)

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#18

Post by hedora » Thu, May 22, 2025, 3:17 AM UTC

hedora wrote: post #15

jameslk wrote: post #12

Earlier quoted context omitted.

This present issue has been caused by decades of bad fiscal policy by both parties: https://fred.stlouisfed.org/series/GFDEGDQ188S Here for example, the Congressional Budget Office, forecasted federal debt as a percent of GDP would continue to rise unchecked, back in 2023 : https://www.cbo.gov/publication/59014 The only presidential politician who sounded the alarm was Ross Perot, all the way back in the 90s. Lyn Ald…

Clinton balanced the budget back in the 90’s. Biden and Obama’s terms were almost entirely defined by picking up economic disasters the previous administration caused. (2009 marked the beginning of the housing crisis, bank defaults due to deregulation and occupy wall street. 2021 was mid pandemic, after Trump spent years printing money with his zero interest rate stuff and tax cuts. He also fired the US funded team t…

I should also add: Trump 2 inherited a stable economy with massive investments in US manufacturing.

Early indications suggest he has already ruined it with tariffs, erratic jailing of skilled laborers and gutting of the government programs and agencies that were supporting the investment in the first place. The dollar has dropped 10% since inauguration day, inflation is way up and the deficit is ballooning.

https://fred.stlouisfed.org/series/C307RC1Q027SBEA

https://www.exchange-rates.org/converter/usd-eur

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#19

Post by polski-g » Thu, May 22, 2025, 3:51 AM UTC

hedora wrote: post #15

jameslk wrote: post #12

Earlier quoted context omitted.

This present issue has been caused by decades of bad fiscal policy by both parties: https://fred.stlouisfed.org/series/GFDEGDQ188S Here for example, the Congressional Budget Office, forecasted federal debt as a percent of GDP would continue to rise unchecked, back in 2023 : https://www.cbo.gov/publication/59014 The only presidential politician who sounded the alarm was Ross Perot, all the way back in the 90s. Lyn Ald…

Clinton balanced the budget back in the 90’s. Biden and Obama’s terms were almost entirely defined by picking up economic disasters the previous administration caused. (2009 marked the beginning of the housing crisis, bank defaults due to deregulation and occupy wall street. 2021 was mid pandemic, after Trump spent years printing money with his zero interest rate stuff and tax cuts. He also fired the US funded team t…

In the 90s, the percentage of young to old was vastly different.

SS/Medicare will bankrupt the country without reforms.

Re: Treasury Yields Soar as Ballooning U.S. Deficit Worries Wall Street

#20

Post by mindslight » Thu, May 22, 2025, 4:17 AM UTC

polski-g wrote: post #19

hedora wrote: post #15

Earlier quoted context omitted.

Clinton balanced the budget back in the 90’s. Biden and Obama’s terms were almost entirely defined by picking up economic disasters the previous administration caused. (2009 marked the beginning of the housing crisis, bank defaults due to deregulation and occupy wall street. 2021 was mid pandemic, after Trump spent years printing money with his zero interest rate stuff and tax cuts. He also fired the US funded team t…

In the 90s, the percentage of young to old was vastly different. SS/Medicare will bankrupt the country without reforms.

What non-USD-denominated liabilities do SS/Medicare have? Those would be required in order for the country to go bankrupt.