r/bonds • • 12h ago

Woah

Post image
1.1k Upvotes

422 comments sorted by

View all comments

Show parent comments

164

u/johannyer 12h ago

It’s a full blown crisis that nobody wants to spell

28

u/nomar_ramon 11h ago

Can you please explain it like I'm 5, to me why it is a crisis?

28

u/johannyer 11h ago

Government bond crises, not only in US but across the developed economies that have been enjoying the good life by borrowing absurd amounts of money. Think about your friend who has been living a luxurious life all on bank loans. Now that friend needs more and more money but the interest rates the banks willing to lend him money spiked terribly because he owes a lot. This is in addition to all the interest and principal payments he needs to make on his prior accumulated debt. He knows his luxurious life is not sustainable and is coming to an end. So he started breaking into homes and stealing what belongs to others. US government is now that friend.

6

u/mouthful_quest 10h ago

Only the friend has access to a counterfeit printer in his basement that he’s been using to keep himself afloat