U.S. federal government borrowing, having driven the total debt from $33 trillion to $34 trillion in seven months, is now projected to drive it to $35 trillion by election day, and perhaps $45 trillion by 2030—but, of course, it won’t get there at all. Financial media are filled with articles which nervously refer back to mid-September 2019, when liquidity “suddenly” disappeared in the entire interbank lending market.
Even the most-quoted U.S. economist, the ubiquitous Mark Zandi, Chief Economist of Moody’s Analytics, said already at on Nov. 22, 2023 in a Yahoo Finance Live interview that he was “worried we might see a freezing up of the U.S. Treasury market.” “There’s a lot of stress,” Zandi said, “What actually breaks?... One thing that I’m watching that makes me nervous, is the liquidity—so-called liquidity—in the U.S. Treasury market.” He did not go into the withdrawal of major foreign buyers of Treasuries due to U.S. war and economic war policies, nor the resulting domination by hedge fund speculation, which is making the Treasury market extremely volatile.
