If there's a real debt crisis with rates going higher across the spectrum (I read recently that only about 20% of US debt has maturity of 10+years! I always thought it was much higher. See ref at the end)....
Trump sometimes talks about devaluing our national debt, which I guess the markets might effectively do for us (US) via the USD forex rate with other major currencies. That should in principle only affect import prices (going higher) and export prices (going lower), although there will be knock-on effects including inflation (cost of imports going up). I have read that, interestingly, inflation helps with regard to debt because interest payments get effectively devalued (but not if rates are rising along with inflation!). So there will be push & pull effects.
The worst situation would be if we ended up in a stagflation scenario like Japan had for a couple of decades. I hope we don't go there. Taking a 20% haircut on everything (asset prices etc) would likely be preferable, although there would be significant one-time pain followed by a longish period of malaise.
I'm not an economist, so my understanding of these matters is rudimentary. I may very well be talking through my hat here.
I don’t think you’re talking through your hat. Probably matters a lot who is running the economy when the shitstorm hits. Bernanke as one example understood the Japan situation better than anybody, probably including anybody in Japan. Let’s hope it’s post-Trump and some competent people are in charge.
Cutting taxes is a political ploy used to make you think the government is giving you something back that they never had before the rate went up.The problem with government taxes is every one in theory want's to use them to pay bills but, to much money is used for indulgences.By that i mean waste.In Trump's case he like's to use them on himself.He just keep's stealing money.
If there's a real debt crisis with rates going higher across the spectrum (I read recently that only about 20% of US debt has maturity of 10+years! I always thought it was much higher. See ref at the end)....
Trump sometimes talks about devaluing our national debt, which I guess the markets might effectively do for us (US) via the USD forex rate with other major currencies. That should in principle only affect import prices (going higher) and export prices (going lower), although there will be knock-on effects including inflation (cost of imports going up). I have read that, interestingly, inflation helps with regard to debt because interest payments get effectively devalued (but not if rates are rising along with inflation!). So there will be push & pull effects.
The worst situation would be if we ended up in a stagflation scenario like Japan had for a couple of decades. I hope we don't go there. Taking a 20% haircut on everything (asset prices etc) would likely be preferable, although there would be significant one-time pain followed by a longish period of malaise.
I'm not an economist, so my understanding of these matters is rudimentary. I may very well be talking through my hat here.
[ The ref I mentioned is https://awealthofcommonsense.com/2026/08/the-biggest-risk-of-rising-bond-yields/ ]
I don’t think you’re talking through your hat. Probably matters a lot who is running the economy when the shitstorm hits. Bernanke as one example understood the Japan situation better than anybody, probably including anybody in Japan. Let’s hope it’s post-Trump and some competent people are in charge.
Cutting taxes is a political ploy used to make you think the government is giving you something back that they never had before the rate went up.The problem with government taxes is every one in theory want's to use them to pay bills but, to much money is used for indulgences.By that i mean waste.In Trump's case he like's to use them on himself.He just keep's stealing money.