Hattip to Ed Morrissey at Hot Air. The New York Times reports that Wall Street is alarmed at the matterhorn of debt the Obama administration is piling up. The Times notes that 10 year Treasury Notes briefly rose to a yield of 3.17% last week, and the federal deficit is currently running at one-seventh of gross domestic product. There is no mystery here. Investors are looking at this debt and beginning to understand two simple facts: it is never going to be repaid and it is doubtful if long-term politically the US can continue to pay the interest on this debt if it dominates an ever-growing portion of tax receipts. I have discussed the issue of national debt a few times on this blog, here , here, here, here and here. We are pursuing lunatic economic policies and we are heading for economic catastrophe.
Update: The People’s Republic of China, i.e. Communist China, sharply curtailed their US bond purchases in January and February before resuming purchases in March. I never thought I would live to see the day when “Red” China would be rightfully concerned with the stability of the US economy and the wisdom of purchasing US debt instruments.