🇺🇸 Could inflation actually make America’s $40 TRILLION debt easier to handle?
Trump says certain levels of inflation could help “pay off” the debt very rapidly.
Here’s the mechanism. 👇
If the government owes $40T in dollars, but prices and wages rise over time, each future dollar is worth less in real terms.
So the real burden of existing fixed-rate debt can shrink. 💵📉
But there’s a catch.
When inflation rises, investors can demand higher Treasury yields. That makes new borrowing and refinancing more expensive — potentially offsetting some of the benefit. ⚠️
And America is already facing elevated borrowing costs, with the 30-year Treasury yield recently reaching its highest level since 2002.
So inflation doesn’t magically erase $40T.
It changes the value of the dollars used to repay it — while potentially making the next $40T more expensive to finance.
That’s the real inflation debt trade-off. 👀
$BTC $ETH $DXYZ.US
#Bitcoin #Crypto #Inflation #USDebt #Markets
Trump says certain levels of inflation could help “pay off” the debt very rapidly.
Here’s the mechanism. 👇
If the government owes $40T in dollars, but prices and wages rise over time, each future dollar is worth less in real terms.
So the real burden of existing fixed-rate debt can shrink. 💵📉
But there’s a catch.
When inflation rises, investors can demand higher Treasury yields. That makes new borrowing and refinancing more expensive — potentially offsetting some of the benefit. ⚠️
And America is already facing elevated borrowing costs, with the 30-year Treasury yield recently reaching its highest level since 2002.
So inflation doesn’t magically erase $40T.
It changes the value of the dollars used to repay it — while potentially making the next $40T more expensive to finance.
That’s the real inflation debt trade-off. 👀
$BTC $ETH $DXYZ.US
#Bitcoin #Crypto #Inflation #USDebt #Markets