Swamp spending going bzonkers

Rank-and-file GOP fear lame-duck vote on pricey funding bill

We have the usual, it is presidential election time, Congress has lost any common sense on the budget, eight years of credit spending needs to be 'portfolioed' off somewhere, and taxes are not growing, so the deficit is now increasing.

Congress is incapacitated, any budget shocks will be handled by short term credit, and rate, recently, have begun a mild climb upward.  Hence, Congress, whatever is action, will deal with a tremendous feedback in the budget due to interest costs and rising short term rates.  These are ripe conditions for a recession, a recession caused by the Swamp, using short term debt, and that is not a good fiscal multiplier folks.

Let's look at the Fed portfolio and ask, has it starting buying short term notes?

Yes, the green line rising are 3 month to 12 month treasuries  held by the Fed.  The Fed is actively trying to lower the one year treasury rate.

 The one year is at .62%, and a sudden short term spending demand by Congress pushes that up to 1%, easily.  The curve will invert or Congress will suffer a ten year rate moving toward 2.5%, and that projects a near term crunch in interest costs, as the rollovers come in.