It’s not the stock and corporate bond markets that cannot stand interest rates rising, it is the federal government that would see the costs of financing our massive debt swallow up the rest of the budget, forcing cuts across the board - military, social security, medicare, every sacred cow would have to be bled severely. A horrible adjustment for all of us who have become dependent on government spending (and it’s much more than 48% of us), but after the transition, we might get back to honest, market driven interest rates and prices.
The math is simple enough, before the crisis 3-month T-bills paid 5% interest and now it's 0.02% --only 1/250th of what it was just seven years ago. Even with these amazingly low interest rates federal outlays for debt interest are still $230B/year. Imagine if (when?) rates go back up and our taxes are raised to support a 250-fold increase to $60T per year.
True this.
And just like the badly run Dimocrat state or city that spends 2X revenue, they will keep the balls in the air as long as possible then it all crashes.
Except the good ole USA can't declare bankruptcy.
They can, however, seize the assets of the "wealthy" (defined as anyone with a savings or retirement account.)