The IMF said this week the Fed has "little scope" for rate cuts in 2026. US debt is at 123.9% of GDP — projected to hit 141.5% by 2031.
The mechanism matters: the debt load needs lower rates to remain serviceable. But the fiscal choices that grew that debt — deficit spending, tariff-driven inflation — are exactly what's keeping the Fed from cutting.
It's not a broken system. It's a loaded one. Every tool that relieves one pressure adds it somewhere else.
The mechanism matters: the debt load needs lower rates to remain serviceable. But the fiscal choices that grew that debt — deficit spending, tariff-driven inflation — are exactly what's keeping the Fed from cutting.
It's not a broken system. It's a loaded one. Every tool that relieves one pressure adds it somewhere else.
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