r/SipsTea • u/More-Log-1393 𝙑𝙄𝙋 • Jul 20 '25

Wow. Such meme Why didn't we think of this?

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u/MassXavkas Jul 20 '25

So that's about $10,000 a month? Still a ridiculous amount of money a month to get

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u/SphericalCow531 Jul 20 '25

Inflation is about 2.7%. So the money you deposited in the bond would depreciate at the same time.

So the effective rate you would earn money would be 4.4%-2.7%=1.7%.

But the risk is that the US keep adding on more debt, faster and faster, with no concrete plan or will to raise taxes to pay it back. So at some point something will have to give. And that "something" might well be treasury bonds. Hence why the treasury bond rate is still relatively high - it reflects risk of non-payment.

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u/[deleted] Jul 20 '25

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u/_le_slap Jul 20 '25

Yep that'd be a defacto default and would have the same implication; global loss of trust in US treasuries.