Edward Conard

Top Ten New York Times Bestselling Author

  • “…serious thinking for serious thinkers. …a thought-provoking blueprint for growing middle- and working-class incomes.” - Mitt Romney, former Governor of Massachusetts
  • “Unintended Consequences is full of substance, it is one of the must-read books of the year, and once I finish it I will be giving it a second read through right away.” - Tyler Cowen, Professor, George Mason University
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
  • “Unintended Consequences is far smarter and more thought-provoking than most economics written for the general public” - Greg Mankiw, Harvard University, Former Chairman of the Council of Economic Advisors
  • “There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “…a must-read for serious students of economic policy.” - Glenn Hubbard, Dean, Columbia Business School, and former Chairman of the Council of Economic Advisers
Upside of Inequality Oxford Unintended Consequences
Buy the Books
  • Macro Roundup
  • About Roundup
  • About Ed Conard
  • Highlights
  • Topics
  • Subscribe
Edward Conard
  • twitter
  • facebook
  • linkedin
  • youtube
  • Email
  • Text Message (SMS)
  • Twitter/X
  • LinkedIn
  • Facebook
  • WhatsApp Message
Subscribe to Macro Roundup Emails
  • Mentions 442
  • Primary focus 219
Showing 219 database articles primarily about Business Cycle
Currently filtering by:
  • Remove Business Cycle
  • Remove "primary topics only" restriction
  • Remove 'Database'
Show all 7,315 articles
For whatever topics you select (currently: Business Cycle):
Choose search scope

Your importance filter 'Database' shows fewer articles.

Remove filters to see full article counts

Deciphering the fall and rise in the net capital share

AI Summary. The net capital share of income in large developed economies has traced a U-shape since World War II, falling until the mid-1970s before moderately rising, with housing accounting for much of the increase. Because housing ownership is less concentrated than other capital, the authors argue this pattern may soften the inequality implications.

Matthew Rognlie Brookings Panel on Economic Activity
Date Posted:
March 20, 2015
Is Database:
Database

The net capital share in large developed economies has followed a U-shaped trajectory postwar, driven mainly by the housing sector. Initially declining until the mid-1970s, the net capital share has since moderately increased, contrasting with gross capital shares.

Does housing explain the rise in the net capital share?

Core argument: The net capital share in large developed economies has traced a U-shape since World War II, declining until the mid-1970s and rising moderately since, with the housing sector the main driver.

The net capital share in large developed economies has followed a U-shaped trajectory postwar, driven mainly by the housing sector, where ownership is less concentrated, potentially mitigating inequality impacts. Initially declining until the mid-1970s, the net capital share has since moderately increased, contrasting with gross capital shares that reflect production structure. Disaggregating net capital income reveals that the residual share of pure profits, influenced by cyclical markups and market power shifts, plays a central role. This underscores the importance of net measures in inequality debates, as they reflect ultimate resource command between labor and capital. The rise in gross capital share in industries like software highlights capital's production role but may not translate to increased returns for capitalists due to rapid obsolescence. Understanding these dynamics is crucial for policymakers and economists analyzing income distribution and market power changes.

Takeaways by Macro Roundup® AI

  1. The net capital share in large developed economies has traced a U-shape since World War II, declining until the mid-1970s and rising moderately since, with the housing sector the main driver.
  2. Because housing ownership is less concentrated than other capital ownership, the housing-driven rise in the net capital share may mitigate its effect on inequality.
  3. Disaggregating net capital income shows the residual share of pure profits, shaped by cyclical markups and shifts in market power, plays a central role, while gross capital shares reflect production structure, as in software, where rapid obsolescence can keep higher gross shares from raising returns to capitalists.

the the point you were most interested in, the life of assets having been shorted see top of page 6)"....Whether a gross or net measure is more appropriate depends on the question being asked: the allocation of gross value added between labor and gross capital more directly reflects the structure of production, while the allocation of net value added between labor and net capital reflects the ultimate command over resources that accrues to labor versus capital....For instance, in an industry where most of the output is produced by short-lived software, the gross capital share will be high, evincing the centrality of capital’s direct role in production. At the same time, the net capital share may be low, indicating that the returns from production ultimately go more to software engineers than capitalists—whose return from production is offset by a loss from capital that rapidly becomes obsolete..."Rognlie, Matthew, "Deciphering the fall and rise in the net capital share,"Brookings Panel on Economic Activity, March 2015. Available at:http://www.brookings.edu/about/projects/bpea/papers/2015/land-prices-evolution-capitals-share
"...First, it argues that as a purely descriptive matter,the recent behavior of income shares is widely misunderstood: rather than experiencing a steady rise, the net capital share for large developed economies has followed a U-shaped trajectory in the postwar era, and its long- term expansion originates entirely in the housing sector.Although both gross and net income shares can be meaningful,net concepts are more relevant to the debate on inequality.Second, this paper observes that when net capital income outside the housing sector is disaggregated between the return on fixed assets and a residual share of pure profits, the U-shaped trajectory is driven mainly by the residual—calling the mechanisms in Karabarbounis and Neiman (2014b) and Piketty and Zucman (2014), which rely on changes in the aggregate value of capital, into question. Finally, it describes the theory of factor shares and the role of elasticities of substitution, evaluating various hypotheses by performing counterfactual simulations in a multisector model.....This measurement reveals a striking discrepancy in the long-term behavior of gross and net shares, echoing the claims of Bridgman (2014); and it shows that the net capital share generally fell from the beginning of the sample through the mid-1970s, at which point the trends reversed. In the long run, there is a moderate increase in the aggregate net capital share, but this owes entirely to the housing sector—where, since ownership is less concentrated, the consequences for inequality may be less severe.In the shorter run, there is both the U-shaped pattern in capital income and a strong cyclical element...It starts by disaggregating net capital income in the corporate sector into components that reflect the return on fixed assets—equipment, structures, and land—as well as a residual term reflecting “pure” profits. Although the decomposition between return on assets and this residual can be somewhat ambiguous, both crude and more sophisticated approaches indicate that the residual plays a central role.To some extent, this residual reflects cyclical variation in markups, but its long-term pattern—which parallels the U-shaped pattern in capital income as a whole—may hint at broader changes in market power and the importance of monopoly profits....I note some intriguing shifts in composition: for instance,there has been a long-term shift in net capital income from land in the non-housing sector to land in the housing sector....Motivated by the limitations of a one-sector model, I construct a multisector model that reflects the disaggregation performed in section 3, and use this model (with a tentative calibration of elasticities) to perform counterfactual simulations that study the influence of key forces on the net capital share—including the observed changes in the relative price of various kinds of investment, and also changes in the real interest rate....For instance, in an industry where most of the output is produced by short-lived software, the gross capital share will be high, evincing the centrality of capital’s direct role in production. At the same time, the net capital share may be low, indicating that the returns from production ultimately go more to software engineers than capitalists—whose return from production is offset by a loss from capital that rapidly becomes obsolete.Both measures are important: indeed, a rise in the gross capital share in a particular industry is particularly salient to an employee whose job has been replaced by software, and it may proxy for an underlying shift in distribution within aggregate labor income— for instance, from travel agents to software engineers. The massive reallocation of gross income in manufacturing from labor to capital, documented by Elsby et al. (2013), has certainly come as unwelcome news to manufacturing workers. But when considering the ultimate breakdown of income between labor and capital, particularly in the context of concern about inequality in the aggregate economy, the net measure is likely more relevant. This point is accepted by Piketty (2014), who uses net measures; the general rationale for excluding depreciation is pithily summarized by Baker (2010), who remarks that “you can’t eat depreciation....As we increase capital relative to labor, the net marginal product of capital declines more rapidly than the gross—in short, capital is less substitutable for labor from a net perspective....” Mobile908.303.9747
Office212.404.4646

  • Business Cycle
  • GDP
    • Growth
    • Housing
  • Productivity
    • Incentives/Risk-Taking
    • Innovation/Research
    • Investment
Previous articleMarch 16, 2015The War on Poverty: Was It Lost?The War on Poverty has seen the official poverty rate fall from 19% to 14.5% by 2013, but relative poverty remains unchanged, with incomes at the 10th percentile being 39-40% of those at the 50th percentile in both 1967 and 2012.Next articleMarch 20, 2015Deciphering the Fall and Rise in the Net Capital ShareThe post-WWII surge in the net capital share, primarily driven by housing, increased from 3% to 8% of private domestic value added, highlighting a significant shift in economic dynamics.
Showing 218 database articles primarily about Business Cycle

3% vs. 60%

AI Summary. The direct lending market is roughly $2tn, or about 3% of total US household and business debt outstanding, compared with mortgages accounting for about 60% of total household and corporate debt at the peak of the housing bubble.

Torsten Sløk Apollo
Date Posted:
April 8, 2026
Is Database:
Database

Torsten Sløk notes the direct lending market is ~$2T or 3% of household and non-financial debt outstanding. To provide context, he shows that in 2006, on the eve of the crisis, mortgages accounted for ~60% of such debt.

Is direct lending too small to threaten the financial system?

Core argument: The direct lending market totals roughly $2 trillion, about 3% of total debt outstanding for US households and businesses.

The direct lending market is roughly $2 trillion, or about 3% of total debt outstanding for US households and businesses. By comparison, mortgages accounted for about 60% of total household and corporate debt at the peak of the housing bubble in 2006.

Takeaways by Macro Roundup® AI

  1. The direct lending market totals roughly $2 trillion, about 3% of total debt outstanding for US households and businesses.
  2. Mortgages accounted for about 60% of total US household and corporate debt at the peak of the housing bubble in 2006, compared with direct lending's roughly 3% share.

Related Articles:

  • JPMorgan Marking Down Loan Portfolios Of Private Credit Groups — JPMorgan has marked down the value of certain loans in private credit funds' portfolios that serve as collateral for the funds' borrowing from the bank, limiting how much it will lend against them. Unlike most banks, which require triggers such as missed interest payments, JPMorgan reserves the right to revalue those assets at any time.
  • Data Update 7 for 2026: Debt and Taxes — The author argues that companies are collectively over-investing in artificial intelligence and that markets will correct when that belief dissipates. Because debt, particularly private credit, now finances much of this investment, the author contends a correction would spread beyond equity holders and produce a banking-style crisis driven by non-bank lenders.
  • Business Cycle
  • GDP
    • Financial Markets

Top 10% of Earners Drive a Growing Share of US Consumer Spending

AI Summary. An analysis of Federal Reserve data found the top 10% of US earners accounted for 49.2% of total consumer spending, up from 48.5% the prior quarter and the highest share in data going back to 1989. Spending by the bottom 80%, those making under roughly $175,000, has merely kept pace with inflation.

Jonnelle Marte Bloomberg
Date Posted:
September 17, 2025
Is Database:
Database

Mark Zandi finds Americans in the top 10% of the income distribution accounted for 49.2% of consumer spending in Q2, the highest level since 1989.

Are top earners accounting for a record share of consumer spending?

Core argument: The top 10% of US earners accounted for 49.2% of total consumer spending in the second quarter, up from 48.5% in the first quarter and the highest share in data going back to 1989, according to Mark Zandi's analysis of Federal Reserve data.

Consumers in the top 10% of the income distribution accounted for 49.2% of total spending in the second quarter, up from 48.5% in the first quarter, reaching the highest level in data going back to 1989, according to an analysis of Federal Reserve data by Mark Zandi, chief economist for Moody’s Analytics. In contrast, the bottom 80% of the income distribution, or consumers making less than roughly $175,000 a year, have seen their spending merely keep pace with inflation since the pandemic.

Takeaways by Macro Roundup® AI

  1. The top 10% of US earners accounted for 49.2% of total consumer spending in the second quarter, up from 48.5% in the first quarter and the highest share in data going back to 1989, according to Mark Zandi's analysis of Federal Reserve data.
  2. Consumers in the bottom 80% of the income distribution, making less than roughly $175,000 a year, have seen their spending merely keep pace with inflation since the pandemic, according to Moody's Analytics chief economist Mark Zandi.

Related Articles:

  • The U.S. Economy Depends More Than Ever on Rich People — Moody's Analytics estimates the top 10% of earners account for 49.7% of all U.S. consumer spending, a record in data going back to 1989, up from about 36% three decades ago, with their spending alone equal to almost one-third of gross domestic product.
  • To Understand America Today, Study the Zero-Sum Mindset — Younger generations in the United States and other rich countries hold more zero-sum views than older ones, a pattern researchers link to growing up amid slower economic growth and lower mobility. People who have surpassed their parents, or whose families rose over generations, are less likely to think in zero-sum terms.
  • Zero-Sum Thinking and the Roots of U.S. Political Divides — Zero-sum thinking — viewing gains for one group as losses for another — is associated with greater support for liberal economic policies, stronger alignment with the Democratic Party, and weaker alignment with the Republican Party. The authors also find it linked to believing the QAnon conspiracy theory holds some truth and to sympathy for the attack on the U.S. Capitol.
  • Business Cycle
  • GDP
  • Workforce
    • Inequality

Litigation Nation, Engineering Empire

AI Summary. Regrouping US college majors to match Chinese disciplines yields a 2:1 ratio of science and engineering to humanities and social sciences, the same ratio as in China. The author argues America's building slowdown reflects structural economic shifts—urbanization reached 70% by 1960 and 85% by 2020, shifting needs toward maintenance—rather than a lawyerly culture.

Jonathon Sine Cogitations
Date Posted:
September 2, 2025
Is Database:
Database
Is Important:
Important

Jonathon Sine argues China “is moving beyond its breakneck industrial prime, facing similar dilemmas to those America confronted in the 1960s and 70s.” The ratio of science/engineering to humanities undergraduate majors is 2:1 in both the PRC and US.

Does America's building slowdown reflect structural shifts rather than lawyerly culture?

Core argument: Regrouping US college majors according to Chinese disciplines yields a 2:1 ratio of science/engineering to humanities/social sciences, the same ratio as in China when management is grouped with science/engineering in both.

Dan Wang’s “big idea” [is] “China is an engineering state, building big at breakneck speed, in contrast to the United States’ lawyerly society, blocking everything it can, good and bad.” I re-group US college majors according to Chinese disciplines to allow for rough comparison. Surprisingly, the ratio of science/engineering to humanities/social sciences is 2:1, the same as in China (if one groups management with science/engineering, as I also do for China). As with China today, America’s breakneck building phase was decidedly winding down by the 1960s. Urbanization went from 40% in 1900 to 70% by 1960, and grew much more incrementally over the next 60 years to 85% by 2020. The country simply did not need to continue building dams, expressways, and energy production facilities at breakneck pace. It became much more a matter of maintaining and upgrading (which has not gone well, at least according to the American Society of Civil Engineers’ report card). The American [building/investment slowdown that started after the 1970s] may be more about structural economic shifts than lawyers.

Takeaways by Macro Roundup® AI

  1. Regrouping US college majors according to Chinese disciplines yields a 2:1 ratio of science/engineering to humanities/social sciences, the same ratio as in China when management is grouped with science/engineering in both.
  2. US urbanization rose from 40% in 1900 to 70% by 1960, then grew more incrementally to 85% by 2020, with America's breakneck building phase winding down by the 1960s.
  3. The US building and investment slowdown that began after the 1970s may owe more to structural economic shifts than to lawyers, qualifying Dan Wang's contrast between China's engineering state and America's lawyerly society.

Related Articles:

  • Industrial Colossus: China vs 1950s America — China's growth in its share of global manufacturing has slowed from roughly 1.5 percentage points per year in the early 2010s to just over 0.5 percentage points annually, about one-third the earlier pace. The author argues China's share of global manufacturing is likely near its peak.
  • The Real China Model — China generates more electricity annually than the United States and European Union combined, having added capacity equivalent to the United Kingdom's total supply each year. Electricity makes up nearly 30% of China's energy use, versus 22% in the US and 21% globally, and its share is growing about 6% a year.
  • America’s Housing Affordability Crisis and the Decline of Housing Supply — Housing production intensity has fallen substantially, especially in fast-growing Sunbelt markets once known for building, converging toward the low rates long seen on the coasts and in declining industrial centers. The authors argue incumbent-controlled regulation explains the weakening link between high prices, high demand areas, and new construction.
  • Business Cycle
  • GDP
    • Growth

How America’s AI Boom Is Squeezing The Rest Of The Economy

AI Summary. About a sixth of America's 2% real GDP growth over the past year came from investment in computer and communications equipment and data centres, and one estimate puts the artificial intelligence boom's total contribution to growth at 40%. Average electricity bills rose 7%, attributed in part to data-centre demand, while housebuilding and non-AI business investment slumped and real consumption flatlined.

Economist Staff The Economist
Date Posted:
August 19, 2025
Is Database:
Database
Is Important:
Important

As AI-related investment has risen since 2023, residential and nonresidential investment have declined or flatlined. This may suggest that a relatively rate-insensitive AI buildout is crowding out more interest-sensitive forms of investment.

Is the AI investment boom crowding out the rest of the economy?

Core argument: Roughly a sixth of the 2% rise in American real GDP over the past year came from investment in computer and communications equipment, including chips, and data centres; one estimate puts the AI boom's contribution at 40% once grid upgrades and software intellectual property are included.

Something like a sixth of the 2% rise in American real GDP over the past year has come from investments in computer and communications equipment, including chips, and data centres. Add in the grid upgrades to power AI models, plus the intellectual-property value of the software itself, and one estimate puts the boom’s contribution to real GDP growth at 40%. The trouble is that the very sector powering so much of America’s economic growth is squeezing the rest of its output. Housebuilders, for instance, cannot afford to be blithe about higher borrowing costs. Data centres have also constrained the rest of the economy by keeping energy prices high. Average American electricity bills have risen by 7% so far in 2025, at least in part due to the extra strain data centres have put on the grid. Real consumption has flatlined since December. Housebuilding has slumped, as has non-AI business investment.

Takeaways by Macro Roundup® AI

  1. Roughly a sixth of the 2% rise in American real GDP over the past year came from investment in computer and communications equipment, including chips, and data centres; one estimate puts the AI boom's contribution at 40% once grid upgrades and software intellectual property are included.
  2. Average American electricity bills have risen by 7% so far in 2025, at least in part due to the extra strain data centres have put on the grid.

Related Articles:

  • Honey, AI Capex is Eating the Economy — Capital spending on AI data centers is around 20% of railroads' peak spending as a share of GDP and is rising quickly, having already surpassed the dot-com era peak in telecom investment. Unlike long-lived rail infrastructure, data centers are short-lived assets requiring frequent hardware replacement, and the capital is being reallocated from other sectors.
  • Back to Our Regularly Scheduled Programming — The four largest US hyperscalers spent $440bn on capital expenditure and research in 2024, with $596bn projected for 2025, a 35% increase, leaving large gaps between AI spending and AI revenues. These firms account for more than half of all capital expenditure growth in the US equity market.
  • The AI Boom’s Hidden Risk to the Economy — Net income at Alphabet, Amazon, Meta and Microsoft rose 73% to $91bn in a quarter two years on, while their combined free cash flow fell 30% to $40bn, as heavy AI investment absorbs cash these firms once recycled into financial markets. That spare cash previously helped hold down long-term interest rates despite large federal deficits.
  • Business Cycle
  • GDP
  • Productivity
    • Innovation/Research
    • Investment

Is it Over?

AI Summary. Benchmark scores show only modest capability gains in the latest large language model releases compared with the larger jump seen two generations earlier, alongside a broader convergence in performance across competing AI models. Commentators attribute this to inherent limits of the technology and the exhaustion of new training data, raising doubts that the spending on AI hardware is justified.

Joseph Wang Fed Guy Blog
Date Posted:
August 18, 2025
Is Database:
Database

Following tepid reactions to the release of GTP-5, Joe Wang observes, “It is looking more like companies are spending hundreds of billions on rapidly depreciating GPUs that produce a commoditized product that most clients only modestly benefit from.”

Are AI capability gains slowing enough to question hardware spending?

Core argument: GPT-5 users widely expressed disappointment with the release, which seemed in some ways a step back, and benchmarks show only modest capability gains since the significant improvement delivered by version 4 two years earlier.

GPT-5 users widely expressed disappointment in the capabilities of the new release, which seemed in some ways a step back. This sentiment is reflected in benchmarks that show a modest improvement in capabilities since the significant improvement in version 4 released two years ago. In addition, the benchmarks suggest a broader convergence in the capabilities of AI models. Commentary suggests this could be due to inherent limitations in the LLM technology and exhaustion of new training data. AI is fascinating technology, but it may not justify the enormous sums spent in its pursuit. It is looking more like companies are spending hundreds of billions on rapidly depreciating GPUs that produce a commoditized product that most clients only modestly benefit from. The entire macro landscape would look very different without the support of the AI boom.

Takeaways by Macro Roundup® AI

  1. GPT-5 users widely expressed disappointment with the release, which seemed in some ways a step back, and benchmarks show only modest capability gains since the significant improvement delivered by version 4 two years earlier.
  2. Benchmarks suggest a broader convergence in AI model capabilities, with commentary attributing this to inherent limitations of large language model technology and exhaustion of new training data.
  3. Companies appear to be spending hundreds of billions on rapidly depreciating GPUs producing a commoditized product that most clients only modestly benefit from, and the entire macro landscape would look very different without the support of the AI boom.

Related Articles:

  • Honey, AI Capex is Eating the Economy — Capital spending on AI data centers is around 20% of railroads' peak spending as a share of GDP and is rising quickly, having already surpassed the dot-com era peak in telecom investment. Unlike long-lived rail infrastructure, data centers are short-lived assets requiring frequent hardware replacement, and the capital is being reallocated from other sectors.
  • Back to Our Regularly Scheduled Programming — The four largest US hyperscalers spent $440bn on capital expenditure and research in 2024, with $596bn projected for 2025, a 35% increase, leaving large gaps between AI spending and AI revenues. These firms account for more than half of all capital expenditure growth in the US equity market.
  • AI’s $600B Question — Comparing spending on AI chips to historical railroad construction overlooks that high-fixed-cost, low-marginal-cost businesses without monopoly or oligopoly power tend to see prices competed down to marginal cost, and that semiconductors continually improve in cost versus performance, unlike physical infrastructure. Speculative frenzies accompany technology, but the payoff will take a long time.
  • Business Cycle
  • GDP
    • Financial Markets
  • Productivity
    • Innovation/Research
    • Investment

US Households and Firms Are in Great Shape

AI Summary. Household and banking sector leverage in the US have declined significantly since 2008, while corporate leverage has moved sideways and federal government leverage has risen significantly. On this measure, the US private sector is in strong financial shape.

Torsten Sløk Apollo
Date Posted:
March 31, 2025
Is Database:
Database

​​Torsten Sløk notes that US household and banking sector debt has fallen to its lowest level in decades as a % of GDP, while corporate leverage has moved sideways. “The bottom line is that the private sector in the US is in incredibly good shape.”

Is the US private sector in strong financial shape?

Core argument: US household sector leverage and banking sector leverage have both declined significantly since 2008, leaving the US private sector in what the author characterizes as incredibly good shape.

Household sector leverage and banking sector leverage have declined significantly since 2008. Over the same period, federal government leverage has increased significantly, and corporate leverage has moved sideways. The bottom line is that the private sector in the US is in incredibly good shape.

Takeaways by Macro Roundup® AI

  1. US household sector leverage and banking sector leverage have both declined significantly since 2008, leaving the US private sector in what the author characterizes as incredibly good shape.
  2. US federal government leverage has increased significantly since 2008, moving in the opposite direction from the deleveraging in the household and banking sectors.
  3. US corporate leverage has moved sideways since 2008, neither declining like household and banking leverage nor rising like federal government leverage.

Related Articles:

  • Global Debt Report 2025 — About 60% of fixed-rate government debt in advanced economies maturing by 2027 — roughly $9tn — was issued before the recent interest-rate tightening, with weighted average yields below 2% versus projected 10-year rates near 3.6%, implying refinancing at nearly double the original cost. France, Spain, the UK, and the US face heightened vulnerability, with maturing debt exceeding 15% of GDP.
  • The Long-Term Budget Outlook: 2025 to 2055 — The Congressional Budget Office projects the 10-year Treasury note interest rate will average 3.8% over 2025–2055, close to its 3.7% average over the prior three decades, with the inflation-adjusted rate averaging 1.5%. It assesses that long-run rates are largely set by structural factors including demographics, saving and investment behavior, and federal debt.
  • Our Thoughts on Large US Deficits and Their Impact on Bond Yields — Total borrowing in the US is about average despite high government deficits, as high public borrowing has contributed to the need for higher interest rates that have depressed private sector borrowing. Risk premiums on long-dated debt look about average, with no market signs that economic or debt limits are currently being hit.
  • Business Cycle
  • Fiscal Policy
    • Fiscal Deficits
    • Government Spending
  • GDP
© Copyright 2026 Coherent Research Institute · All Rights Reserved · Privacy · Terms