加入 getAbstract 阅读摘要

Deficits are Raising Interest Rates. But Other Factors are Lowering Them.

加入 getAbstract 阅读摘要

Deficits are Raising Interest Rates. But Other Factors are Lowering Them.

Medium,

5 分钟阅读
5 个要点速记
音频和文本

看看什么内容？

Paradoxically, US interest rates in 2019 remain at historic lows, despite massive fiscal debt.

自动生成的音频
  • 0.5×
  • 0.75×
  • 1×
  • 1.25×
  • 1.5×
  • 1.75×
1×
自动生成的音频

Editorial Rating

7

Qualities

  • Analytical
  • Overview
  • For Experts

Recommendation

Most financial experts stand by the traditional thinking that large deficits and high levels of fiscal debt raise interest rates. But the US national debt, as a percentage of GDP, ballooned from approximately 33% in 2001 to a 2019 level of 76%, while interest rates in March 2001 were more than two percentage points higher than in March 2019. In this cogent analysis for policy professionals, economist Ernie Tedeschi takes a deep dive beneath the surface of a complex dynamic.

Summary

US deficit spending and accumulated debt have soared since the early 2000s, marking a spending spree that promises to continue through the foreseeable future. Many experts are steadfast in asserting the long-accepted rationale that rising deficits and debt ultimately lead to higher long-term interest rates. But data from 1999 to 2019 show an inverse association between debt levels and interest rates. The prevailing theory could be completely inaccurate, or it could be incomplete, failing to account for other factors that also bear significantly on interest...

About the Author

Ernie Tedeschi is an economist and managing director at Evercore ISI.

Comment on this summary