The Treasury Secratery of the United States says,
…achieving fiscal discipline, can only lead to one thing: higher taxes. And higher taxes always mean a larger role for government and a smaller role for the private sector. Is that the way we want to go? I don’t think so.
(Never mind having to pay interest on borrowing…)
On a likely related note,
Yields have risen sharply by 0.6 percentage points so far this year, reaching 5.036pc in New York last night.
… Analysts said the spike in yields is chiefly caused by an exodus of Asian investors, who hold a huge chunk of the US national debt.
“We’ve started seeing a lot of money being repatriated into the Japanese equities market,” said Matthew Smith, a manager at Smith Affiliated Capital. Japanese holdings of foreign bonds has fallen by $70bn so far this year, according to data from Japan’s finance ministry.
Dumping out of US funds? They probably heard that our Treasury Secretary thinks fiscal discipline is a bad thing.