Summary

• The 30-year Treasury yield hit its highest level since 2007 (~5.18%) amid growing inflation worries.
• In this article, I will discuss why bond prices are dropping, yields are surging, and why 5% is the magic threshold that could break the economy.
• The US government has $39 trillion in debt currently and faces significantly higher borrowing costs, which creates a feedback loop that strains the budget, crowds out other spending, and raises long-term risks.
• Japan’s bond market is sending a warning across global markets as long-dated government debt faces one of its sharpest selloffs in decades.

"You are going to see a crack in the bond market. Our fiscal situation is a 350-lb two-pack-a-day smoker on the ICU table. The US federal budget is on an unsustainable path. I’m telling you it’s going to

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