The following is difficult to write because I love this country. The United States is now paying an increasing amount of dollars to carry its debts, but get this -- the United States is now actually borrowing to pay the interest on its debt.
Who at this point wants to buy large amounts US debt? Nobody, so the Federal Reserve is buying our own debt with money it creates out of thin air. Thus the finances of the US are operating like a drunken sailor on a never-ending binge.
The chart below shows TLT, the long-term treasury bond fund. The lower TLT falls, the higher interest rates go. Higher rates will cost the US many billions more to carry our debt. The chart shows a breakdown of TLT with a little consolidation in the 103-106 boxes. If this consolidation hits the 100 box, the P&F projection goes all the way down to 80. ... Log in or subscribe to continue reading.
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