The 10-year US Treasury yield surpasses the S&P—what does this mean?
The stock market can’t even keep up with bond yields anymore, so funds will flee across the board!
With a risk-free annualized return of 5% on US Treasuries, isn’t that great?
If everyone buys US Treasury-backed “stocks,” it would all collapse—and then a financial crisis begins!
The more money the US government owes, the higher the interest it pays; when the economy collapses, there’s no new revenue to cover the interest!
Won’t the government ever go bankrupt?
The chance of a US government default is still not high (military/financial tools to bridge and prevent risk contagion from spreading globally).
A structural financial crisis is coming!
In 02, the internet bubble burst (6%), and in 07, the financial crisis hit (5%)
The stock market can’t even keep up with bond yields anymore, so funds will flee across the board!
With a risk-free annualized return of 5% on US Treasuries, isn’t that great?
If everyone buys US Treasury-backed “stocks,” it would all collapse—and then a financial crisis begins!
The more money the US government owes, the higher the interest it pays; when the economy collapses, there’s no new revenue to cover the interest!
Won’t the government ever go bankrupt?
The chance of a US government default is still not high (military/financial tools to bridge and prevent risk contagion from spreading globally).
A structural financial crisis is coming!
In 02, the internet bubble burst (6%), and in 07, the financial crisis hit (5%)
