5%

Treasury Secretary Scott Bessent testifies during an annual House Committee on Financial Services hearing on the state of the international financial system in the Rayburn House Office Building on September 15, 2026.
Chip Somodevilla/Getty Image

Not an economist, rather a fund raiser and political scientist, Bessent and The Donald have managed to raise US debt to a cool 40 trillion with Treasuries paying a cool 5% to corporate and private investors, something most disquieting to financial types knowing far more about finance than yours truly.

Treasury yields are already blowing up the CBO’s long-term forecasts, and experts who previously downplayed U.S. debt fears are now starting to worry

 30 year mortgage average    30 Year Treasury Bond    10 Year Treasury Note    2 Year Treasury Note   
3 month Treasury Bill    Effective Federal Funds Rate    CPI inflation year/year   Recessions

The 10-year Treasury yield topped 5% this past week, hitting the highest level since 2007 and blowing way past forecasts for borrowing costs over the next decade.

According to the Congressional Budget Office’s most recent long-term outlook issued in February—before the Iran war spiked oil prices and inflation views—the benchmark yield was seen at 4.1% this year and 4.2% in 2027. The 10-year yield was expected to hover around 4.3% from 2028 to 2031, then tick up to 4.4%
from 2032 to 2036.

In addition to setting the pace on other borrowing costs, yields determine how much the Treasury Department must pay in interest on the U.S. debt, which can accelerate as rates go up.

The $40 trillion in U.S. debt that has accumulated as well as $2 trillion in annual budget deficits that
show no sign of improving are also factors.

Add it all up, and the future looks more expensive. The Committee for a Responsible Federal Budget estimated that if yields remain more than 80 basis points over baseline projections, the U.S. will spend $2.7 trillion on annual interest payments by the end of the decade—more than Medicare or Social Security retirement benefits.

“The real threat is the debt spiral. If interest begets debt, and debt begets interest, eventually debt will spin out of control. A fiscal crisis, once unthinkable, is now a distinct possibility,” Maya MacGuineas, president of the CFRB, said on Monday.

Any questions?