5% on the 30-year raises the risk-free rate, which changes the equity discount rate. a 40x stock looks very different at 5% vs 2%. growth stocks re-rate when yields move
andsoitis 27 days ago [-]
as debtor, you have to pay a higher price when the creditor's risk for non-payment increases. power of the market.
dlcarrier 27 days ago [-]
The US can always print money; it's the expected inflation dictates the value of bonds.
nsvd2 27 days ago [-]
Well, yes, but that's another way of saying the same thing. If the US can't pay and is forced to devalue their currency, thus tanking the value of your investment, you lose money. Therefore, the likelihood of this drives interest rates up.
pseudohadamard 26 days ago [-]
Will the US still be in any shape to be pay out in 30 years? That's a serious question.
Enthusiasts were still using it a and releasing updates, over a decade later.