George Gammon: Debt and deficit scenario raises yield question for U.S. treasuries

George Gammon: Debt and deficit scenario raises yield question for U.S. treasuries
Debt levels and yields in U.S. scenario

George Gammon, host and investor at Rebel Capitalist, presents a thought experiment about U.S. debt levels. He asks readers to imagine a scenario where U.S. deficits are 1% of GDP, debt-to-GDP is 20%, and nominal GDP growth stands at 6.5%.

Gammon then raises the question of what the yield on a 10-year treasury would be under these conditions, noting that the current yield is 5.35%. His exercise highlights the implications for interest rates if fiscal fundamentals changed dramatically.

Gammon has previously discussed swings in fixed income markets. In an earlier article, he highlighted increasing volatility in the bond market. He also shared his approach to profiting from these shifts.

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