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No. of Recommendations: 10
What's the affect of this on the Federal budget? Massive.

Let's explain why.

The elephant-in-the-room here is interest expense risk...not interest rate risk--interest expense risk. Currently the interest on the US debt is about 8% of the annual budget, but this interest rate is at historic lows (just over 1%). Historically, the interest rate on the Treasuries used to find the debt has been around 4%. So what happens if inflation loons larger, the Fed is forced to raise rates and the Treasury notes issued to replace the shorter maturity T. Bills that are maturing gets back to historical norms and so a few years from now, when Biden's cronies are gone, the interest expense could consume 30% of the federal budget. Can you say "ECONOMIC DEPRESSION" ???

BruceM
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