US Budget Deficits Are Exploding Like Never Before

American politicians are keener than ever to juice the economy with government cash.

  • The shift is already helping to drive up borrowing costs and looks likely to keep them high long after inflation dies down.

Even though the economy appears to be in good health, the federal budget is suffering from unprecedented crisis-size deficits left and right.

  • Uneasy Investors: As a result, yields on benchmark 10-year Treasuries have climbed above 4.3% this week, their highest since 2007.
  • Other borrower costs are rising in tandem: The average rate on a 30-year fixed mortgage has surged above 7% for the first time in more than two decades.

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