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If deficits are so bad, why are U.S. Treasury rates so low?

Many believe that if our debt was really a big deal, investors wouldn’t be supplying us with capital so cheaply. However, many investors are paralyzed and uncertain about where to put their money. With once safe economies now in the gutter, U.S. Treasuries have become, in essence, the cleanest port-o-potty at the state fair.

This report explains why interest rates on U.S. government debt are likely to rise in the future absent a balanced budget deal that changes our fiscal trajectory, and why by the time markets signal that the U.S. has too much debt, it will likely be far too grave to readily correct.

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