And the Cheshire-cat grinning gobshite Kevin Hasslett is waiting in the wings for his nomination to replace Fed Chair Powell...shitshow doesn't half explain where we're heading.
We have a substantial portion of retirement nest egg held in T-notes of varying maturities, in order to supplement SS benefits...the interest rates currently — round 4% net — is a reflection of the current US economy, INCLUDING inflationary pressures. Dropping rates to a trump ZIRP would savage our income stream whilst boosting inflation...how the fuck does THAT work for us? Short answer: it fucking doesn't.
It was reported recently that a Chinese debt offering was oversubscribed by a factor of 30. The offering was $6 Billion and it sold $118 Billion. This was in spite of the offering carrying a lower interest rate than the U.S. is offering. They opted for security and stability against the U.S. economy by whim. We have $8 Trillion up for refinancing this year.
It's more than that... roughly 40% of US bonds, bills, and notes need to be refinanced in 2026. That's approximately 16 trillion dollars in debt. Since roughly 2/3rds of that is debt issued in 1996, average bond rates were around 6.5%. Since those bonds now pay like 4.6%, doubtful people will roll over into another round of 30s.
The obvious play is to put pressure on U.S. long-term debt to pay better. That's why the US is playing the swap game now... swapping 30s for short terms on its own treasury sheet, to keep the market for 30s liquid.
Things are gonna get freaky deeky. :P
Trump thinks, "well let's make that problem totally fucking worse by dropping rates to zero."
Sure... why not. While we're at it... let's just go back to goats and pebbles. :P
Unbelievable. Can't help but wonder what's going on behind the scenes in financial circles. Have you ever looked at "bail-in?" Public at risk-public be damned.
I don't think we're there just yet... but if the global situation deteriorates much more? I'm not sure how a bail-in works when it's the government... but I would imagine it would involve something along the lines of changing social security and medicare/medicaid payouts... to reduce the outflows against that government debt and slow the rate at which the securities had to be sold.
Again, I'm not sure how a bail-in would work when it's a sovereign entity.
To assist, bail-in is a change to Dodd-Frank banking law following the last bail-out. Now banks can classify deposits as credit obligations in order to bail-in and save them from bankruptcy. They will effectively take depositors money and make them unsecured creditors with only FDIC to cushion the losses. Now Trump is talking about taking control of FDIC. Two banks in Cyprus did a bail-in in 2013 with depositors losing over 60% of their money. The law was changed to relieve government from bailing out banks again.
I'm ignorant on that. I'm hoping for an article that deep dives into what happens when we default. I'm sure they'll be popping up soon. Thanks for your writing.
Jesus Fucking Christ!! This is surreal.
Trump is an epic cunt...and Blondi an utterly craven twat.
How deep does this rabbit hole go?
Oh wait. It's Trump. It's bottomless.
And the Cheshire-cat grinning gobshite Kevin Hasslett is waiting in the wings for his nomination to replace Fed Chair Powell...shitshow doesn't half explain where we're heading.
We have a substantial portion of retirement nest egg held in T-notes of varying maturities, in order to supplement SS benefits...the interest rates currently — round 4% net — is a reflection of the current US economy, INCLUDING inflationary pressures. Dropping rates to a trump ZIRP would savage our income stream whilst boosting inflation...how the fuck does THAT work for us? Short answer: it fucking doesn't.
And…it’s all in Project 2025
💙💪🏻🔥
It was reported recently that a Chinese debt offering was oversubscribed by a factor of 30. The offering was $6 Billion and it sold $118 Billion. This was in spite of the offering carrying a lower interest rate than the U.S. is offering. They opted for security and stability against the U.S. economy by whim. We have $8 Trillion up for refinancing this year.
It's more than that... roughly 40% of US bonds, bills, and notes need to be refinanced in 2026. That's approximately 16 trillion dollars in debt. Since roughly 2/3rds of that is debt issued in 1996, average bond rates were around 6.5%. Since those bonds now pay like 4.6%, doubtful people will roll over into another round of 30s.
The obvious play is to put pressure on U.S. long-term debt to pay better. That's why the US is playing the swap game now... swapping 30s for short terms on its own treasury sheet, to keep the market for 30s liquid.
Things are gonna get freaky deeky. :P
Trump thinks, "well let's make that problem totally fucking worse by dropping rates to zero."
Sure... why not. While we're at it... let's just go back to goats and pebbles. :P
Unbelievable. Can't help but wonder what's going on behind the scenes in financial circles. Have you ever looked at "bail-in?" Public at risk-public be damned.
I don't think we're there just yet... but if the global situation deteriorates much more? I'm not sure how a bail-in works when it's the government... but I would imagine it would involve something along the lines of changing social security and medicare/medicaid payouts... to reduce the outflows against that government debt and slow the rate at which the securities had to be sold.
Again, I'm not sure how a bail-in would work when it's a sovereign entity.
To assist, bail-in is a change to Dodd-Frank banking law following the last bail-out. Now banks can classify deposits as credit obligations in order to bail-in and save them from bankruptcy. They will effectively take depositors money and make them unsecured creditors with only FDIC to cushion the losses. Now Trump is talking about taking control of FDIC. Two banks in Cyprus did a bail-in in 2013 with depositors losing over 60% of their money. The law was changed to relieve government from bailing out banks again.
Yeah yeah I get that with respect to banks... but it's not banks that will be failing in this case... it's the bond market.
I'm not sure how that works when the bond issuer is the US Government.
I'm ignorant on that. I'm hoping for an article that deep dives into what happens when we default. I'm sure they'll be popping up soon. Thanks for your writing.
We find anything (so far) you write penultimately informative. With or without 'analysis.' Thank you.
Many of which we have already learned through centuries of living experiences.
It’s the USSR playbook, destroy and bankrupt all so the assets can be bought by oligarchs at a fire sale.
Myanmar. That's what we are becoming