The Single Most Important Chart in the World is Flashing “Danger”

By Graham Summers, MBA – GAINS, PAINS & CAPITAL

The defining issue of the last ~45 years has been the secular bull market in bonds. From 1980 until 2022, the yield on the U.S. debt (called Treasuries) was in a downtrend. In the very simplest of terms, this meant that throughout this time period, debt became ever cheaper to service. As a result of this, every entity in the U.S. whether it be corporations, municipalities, and even the U.S. itself as a sovereign nation, went on a debt binge.

Today, there is there is $3.4 trillion in municipal debt, $14 trillion in corporate debt, $20 trillion in household debt, and $37 trillion in Federal debt outstanding. Throw in student debt, auto loans, and every other kind of future liability and the U.S. is sitting on over $100 trillion in debt.

All of these are problematic, but the SYSTEMIC issue pertains to U.S. sovereign debt.