Borrowing needs are expected to rise to $550 billion in the three months to Dec. 31, compared with the $142 billion predicted in July, the Treasury said in a statement in Washington. That follows a $530 billion record in the July-September quarter.
As I noted over the weekend, these huge financing needs combined with foreign governments need to stimulate their domestic economies (and maybe even selling foreign reserves) could lead to higher intermediate to long term rates in the U.S. next year – right in the middle of a recession.
We have been preaching that for a while. People should not be fooled by the current low rates interest rates on the Federal Debt. They will not last.