{"id":67830,"date":"2024-05-03T12:10:28","date_gmt":"2024-05-03T17:10:28","guid":{"rendered":"https:\/\/olduvai.ca\/?p=67830"},"modified":"2024-05-03T12:10:28","modified_gmt":"2024-05-03T17:10:28","slug":"david-stockman-on-the-1-3-trillion-elephant-in-the-room","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=67830","title":{"rendered":"David Stockman on the $1.3 Trillion Elephant In The Room"},"content":{"rendered":"<header class=\"content-header fixed\">\n<h3 class=\"entry-header content-list-title\">David Stockman on the $1.3 Trillion Elephant In The Room<\/h3>\n<\/header>\n<div class=\"content-thumb\"><img loading=\"lazy\" decoding=\"async\" class=\"attachment-post-thumbnail size-post-thumbnail wp-post-image\" src=\"https:\/\/internationalman.com\/wp-content\/uploads\/2024\/05\/shutterstock_98578802.jpg\" sizes=\"auto, (max-width: 600px) 100vw, 600px\" srcset=\"https:\/\/internationalman.com\/wp-content\/uploads\/2024\/05\/shutterstock_98578802.jpg 600w, https:\/\/internationalman.com\/wp-content\/uploads\/2024\/05\/shutterstock_98578802-300x218.jpg 300w\" alt=\"$1.3 Trillion Elephant In The Room\" width=\"600\" height=\"436\" \/><\/div>\n<p>These people have to be stopped!<\/p>\n<div class=\"content\">\n<p>We are talking about the nation\u2019s unhinged monetary politburo domiciled in the Eccles Building, of course. It is bad enough that their relentless inflation of financial assets has showered the 1% with untold trillions of windfall gains, but their ultimate crime is that they lured the nation\u2019s elected politician into a veritable fiscal trance. Consequently, future generations will be lugging the service costs on insuperable public debts for years to come.<\/p>\n<p>For more than two decades these foolish PhDs and monetary apparatchiks drove the entire Treasury yield curve to rock bottom, even as public debt erupted skyward. In this context, the single biggest chunk of the Treasury debt lies in the 90-day T-bill sector, but between December 2007 and June 2023 the inflation-adjusted yield on this workhorse debt security was negative\u00a0<em>95%<\/em>\u00a0of the time.<\/p>\n<p>That\u2019s right. During that 187-month span, the interest rate exceeded the running (LTM) inflation rate during only<em>\u00a0nine months<\/em>, as depicted by the purple area picking above the zero bound in the chart, and even then by just a tad. All the rest of the time, Uncle Sam was happily taxing the inflationary rise in nominal incomes, even as his debt service payments were dramatically lagging the 78% rise of CPI during that period.<\/p>\n<p><strong>Inflation-Adjusted Yield On 90-Day T-bills, 2007 to 2022<\/strong><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-57383 aligncenter\" src=\"https:\/\/internationalman.com\/wp-content\/uploads\/2024\/05\/Imagen1-293x300.png\" sizes=\"auto, (max-width: 417px) 100vw, 417px\" srcset=\"https:\/\/internationalman.com\/wp-content\/uploads\/2024\/05\/Imagen1-293x300.png 293w, https:\/\/internationalman.com\/wp-content\/uploads\/2024\/05\/Imagen1.png 416w\" alt=\"\" width=\"417\" height=\"427\" \/><\/p>\n<p>The above was the fiscal equivalent of Novocain. It enabled the elected politicians to merrily jig up and down Pennsylvania Avenue and stroll the K-Street corridors dispensing bountiful goodies left and right, while experiencing nary a moment of pain from the\u00a0<a href=\"https:\/\/internationalman.com\/special-report\/guide-to-surviving-and-thriving-during-an-economic-collapse\/\" target=\"_blank\" rel=\"noopener\">massive debt burden<\/a>\u00a0they were piling on the main street economy..<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>David Stockman on the $1.3 Trillion Elephant In The Room These people have to be stopped! We are talking about the nation\u2019s unhinged monetary politburo domiciled in the Eccles Building, of course. It is bad enough that their relentless inflation of financial assets has showered the 1% with untold trillions of windfall gains, but their [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[2120,195,303,431,6228,534,827,834,3650],"class_list":["post-67830","post","type-post","status-publish","format-standard","hentry","category-economics","tag-david-stockman","tag-debt","tag-fed","tag-interest-rates","tag-international-man","tag-monetary-policy","tag-united-states","tag-us","tag-us-federal-reserve"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67830","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=67830"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67830\/revisions"}],"predecessor-version":[{"id":67831,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/67830\/revisions\/67831"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=67830"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=67830"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=67830"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}