DC borrowing cycles, curve steepnesss, citizens screwed

Here I have the ten year treasury rate minus the two year, and that tells us how steep the curve is (red line).  Mainly it tells us how much extra rate DC has to pay if they want to borrow long term. The blue line is the deficit as a percent of GDP, it tells us how much debt DC is throwing on the market. The lower the blue line the more debt placed on the market, so negative means a big deficit and lots of debt.

Notice, oddly, the blue line drops and the curve gets steeper, so DC always pays high rates just when it borrows the heaviest.

Market supply and demand?

Well, yes, except it is planned supply.  Generally the housing bubble happens earlier, as we saw in my last post. The deficit spending always goes higher at a specific time, around mid term election at the end of the presidential cycle.   Can the housing market predict this?  For example, look at the steepness today, the red line getting steeper, right?  But the deficit has not yet started growing, and the mini housing bubble has already started popping.  My God, is the bond market prescient? No, the numbers are in.  The debt machine is already popping. DC could not get a cheap rate on the two year, and DC is already being forced up the curve and paying higher rates.  The only thing missing is the lag in the deficit numbers, they come out late, and the average citizen does not know that DC is once again in the debt trap.

Keynesian deny this is happening, but it is right here, on this chart.  Blue line down, red line up, happens at the end of every presidential cycle.  How in the hell do idiotic Keynesians miss this?  I am confused and may have to get off the couch and look at this closer.  Keynesian cannot be this dumb.

Why should the average citizen care?

Because bonehead Keynesians start this pricing bubble which moves through the economy in regular steps. The average citizen cannot plan his life around a bunch of idiots in DC, and he pays a heavy price in mispricing.

But haven't rates dropped over the last thirty?
They sure have, but DC still pays the same relative gain.

So when does the recession start?

Well look at the blue line marks. The BEA generally marks the beginning of the recession that same time they mark the up turn in the deficit (blue line down).  So the deficit will turn bad the next quarter report because we already know the Obamacare bills will drive the blue line down next quarter because California, New York and Texas have just sent their bills upstream. So go ahead and mark you recession start, officially, at Nov 1, just before the election.