That’s because rates are low. A few points on the national debt, and it changes pretty quickly. We have been paying almost nothing for ten years. That will rise pretty darned fast once rate start moving. And with the dollar liquidity going low—the only way to free up capital is to pay more for it.
That will hurt. A lot.
“We have been paying almost nothing for ten years. That will rise pretty darned fast once rate start moving.”
That depends upon how many 30 year bonds the Treasury has been selling at these low rates.
“And with the dollar liquidity going low”
Why do you think liquidity is going low?
By Jane Ihrig, Associate Director and Economist, Federal Reserve Board of Governors
Tuesday, March 5, 2019
The Federal Open Market Committee (FOMC) has stated that it would like to operate monetary policy in the longer run with an ample supply of reserves in the banking system. In recent weeks, market participants have been mentioning estimates of the level of ample reserves to be in a range of $1 trillion to $1.4 trillion, much larger than the pre-crisis level of less than $20 billion. This eye-popping increase in the projected level of reserves needed to implement monetary policy reflects, in large part, banks’ increased demand for reserves resulting from new liquidity regulations...