I’m not well versed in the bonds world, so i’m hoping someone on here can explain why one should care about rising US bond yields.
i get the direct implications of the US needing to spend more on interest payments when their existing bonds mature, but i’m curious to learn more about the second-order effects. i’m also not sold on the idea that the rising interest costs are a real problem for the functioning of our financial system (at least in the near term)… seems like more money printing is the obvious solution… with the obvious side effect of more inflation.
the way some macro folks talk about it on twitter, you’d think a 5% 10 year yield means the world is coming to an end, and i’m not really connecting the dots there.
the narrative a couple of years ago was that the US couldn’t possibly raise rates because of the high debt load, but here we are.
do you see rising US bond yields as a meaningful problem in the next year? what are the second-order consequences of US bond yields going up from here?