Rising interest rates mean deficits finally matter

(Image: Getty)

Fri, 06 Oct 2023

By Greg Ip The US has long been the lender of last resort to the world. During the emerging-market panics of the 1990s, the global financial crisis of 2007-09 and the pandemic shutdown of 2020, it was the Treasury’s unmatched capacity to borrow that came to the rescue.Now, the Treasury itself is a source of risk. No, the US isn’t about to default or fail to sell enough bonds at its next auction. But the scale and upward trajectory of US borrowing and absence of any political corrective now threaten markets and the economy in wa...

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