10 Year treasury rate spiked to 4.6% yesterday and 30-year bond to 5.13%, close to a 20-year high. Is it a sign of times?
In the “normal” times, if we even “dare” to imagine such times, these rates could be 2% higher or upward of 6%. Easily. That is how the business world works and government is supposedly, too, to a fair degree. However, we know all too well that we do not live in “normal” times anymore.
We are anxiously heading to “bankrupting” our country. In absence of the “disaster inviting” president, America would have “likely” gone bankrupt in about 10 to 20 years in a “slow motion” fashion due to unfunded liabilities of Social Security and Medicare, two biggest entitlement programs.
However, with the utterly incompetent president of the country that is in decline for quite some time, we are heading fast towards the disaster. The end is near. America elected a “perfect guy” with an “uncanny pedigree” in bankruptcy to fail and bankrupt our nation. He will only make it faster for us and more painful than otherwise it would have been. Welcome to the new world!
In all, enough damage has been done already to our nation by 3 drunken sailors hitting 3 disastrous icebergs. It is about time we start reckoning.
Three drunken sailors are President of the United States (POTUS), The Federal Reserve (Fed) and Stock market which have already hit three catastrophic icebergs – deficit, tariff and Iran war. These three “man-made” accidents are bound to sink the Titanic of USA into oblivion – a very unpleasant situation.
Bonus part is that the international reputation for the US is already in tatters that can take decades, not years, to restore, if we are willing. We have become a laughing stock for the entire world as many of us cannot recognize is this the same America that we have known for so long.
Clearly, the “bond vigilantes” are not “smart and wise” enough to jack up the rates high enough and fast enough only to recognize at some point later by when much of the damage would have been done already and the monumental cost would have been borne by the “innocent” masses or shall we say “ignorant masses” who allowed all this nonsense to happen?
If these “bond vigilantes” were doing their job properly then truly the interest rates would have been much higher given the “State of the Union” and helped keep the “bad actors” in line or somewhat of a control. Instead, they gave them a free reign to do whatever they wanted. Hence, the heavy price to pay at some point by continuing to kick the can down the road.
In summary, we are well on our way to bankrupting our nation at a faster rate – as fast as we can. As opposed to slowing down the pace, we are quickening our pace to the disaster.
Back in November of 2025, we published the following post and since then, for about 6 months, all the things that matter to all ordinary citizens have continued to get only worse, not better: Fed & POTUS in the Box: Trouble Ahead & Time to Buckle Up
Here is our short synopsis on the icebergs and drunken sailors who are very apt at hitting these icebergs.
Iceberg # 1 – Budget Deficit:
Persistently running 5-6% annual deficit for our federal budget has been a norm, not an exception for our financially incompetent president – be it his first term or second. Federal debt at $39 trillion with the annual deficit approaching $2 trillion is nothing but a recipe for the disaster.
By the way, we have not even touched upon another half a trillion-dollar requested increase in the defense spending – from close to one trillion to one and a half. As mentioned in an earlier post, the interest cost alone will approach a trillion and half in no time that is sitting comfortably at a trillion dollars at this time.
Iceberg # 2 – Tariffs:
We hit the iceberg of tariffs in 2025 by our “Supremely Incompetent Drunken Sailor” and Supreme Court helped tremendously to divert the sinking ship away from the iceberg. However, it is little too late and the damage has already been done.
Nevertheless, kudos to the Supreme Court for doing the “right thing” to “save” our country to the best of its ability, especially, the conservative judges, who voted with the “minority” liberal judges to make it happen and still continue to get the barrage of insults from our “evil” president.
Iceberg # 3 – Iran War:
As if the self-inflicted wound of tariff from 2025 was not enough, our “delusional” president took on a new evil undertaking of going to war with Iran, precisely at the wrong time and when we can least afford it and especially when it was unprovoked. No wonder, we continue to refer him as a “suicidal” individual given his “lunatic” actions while sitting at the highest office of the land that is supposedly the most powerful on this earth.
Drunken Sailor # 1 – POTUS:
Do we need to say much about this?
Drunken Sailor # 2 – The Fed:
As for the Federal Reserve being a drunken sailor, enough has been implicitly understood by many people, though, not enough has been stated explicitly. In essence, they are a complicit to creating the Iceberg # 1 of budget deficits by means of funding it only compounded by financial engineering and all money maneuvers to keep the interest rates low to create the biggest heist in the history of a mankind and “steal” from the ordinary individuals. A thieve in disguise.
That is a wealth transfer form the “poor and average man” to the “wealthy elites” and financial institutions. Essentially, it is the Fed that “robbed” the poor men and retirees to “fatten” the wallet of the riches as if they do not have enough wealth.
Drunken Sailor # 3 – Stock Market:
Yes, when we say that stock market is the culprit here, it is in fact, the “fundamentals and reason blind” investors – both professionals and individuals alike who do not seem to care or give a hoot for what tomorrow may hold and what our children and grandchildren may face. Their mantra is pretty clear and simple – keep drinking the same “cool-aid” and forget about how bad the hangover or resultant pain will be after getting much drunk or how much they may cause to others including their own.
In a last week’s post, we covered about the valuations using the Buffett indicator and CAPE ratio, none of which seem to matter to these drunkards. Sky is the limit for them, not any “other worldly” limit. We can only wish them the luck.
The sad part is the everyone will have to price for the “foolish” deeds of many and “evil” deeds of a few. Folks have started to pay the price already and anyone denying that effect is clearly not an “average” man.
It took a while to sink the giant ship as Titanic over 100 years ago or in 1912 – just about 3 hours. For the Titanic of USA to sink, our drunken sailor may take equivalent of one month, one quarter or even one year for each hour of Titanic sinking time. Meaning, it could be 3 months, 3 quarters or 3 years based on this simple analogy. Where exactly we are on this journey is anyone’s guess. God bless America.
