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A possible rise in Treasuries Yields near and above 2% could become challenging for the U.S. Treasury, with ripple effects on large institutional bond funds. With the amounts ever-growing of U.S. Treasuries issuance, that has brought the Federal Reserve balance to the $7.0 Trillion dollars mark, the fiscal space available to the U.S. Treasury and the flexibility of the Federal Reserve balance sheet could hit the buffers. Considering the United States GDP $21.1 Trillion Dollars in Q4 2020, while in 2012 Dollar prices $18.0 Trillion dollars, the overall American economy sees itself sustained by $15 Trillion dollars in commercial banks credit, whereof that some $10 Trillion in loans and leases from the banking sector, while the Federal Reserve also extended, up until now, $7.0 Trillion dollars in credit to the economy, through a variety of credit facilities, including a $2.0 Trillion backstop the housing market. The Amount of debt, up until now, extended to the U.S. economy near the 3/4 of the overall U.S. GDP, with the Federal Reserve in any scenario, expanding the balance sheet toward the $10 Trillion mark, the overall outstanding credit to the U.S. economy would equal the GDP of the country, that excluding the Publidebt/GDP ratio that has already grown above the 100% landmark, but the combinations of Federal Reserve balance sheet expansion, to backstop debt, and the $10 Trilllion in loans and leases in the banking system, do highlight that the economic growth of the United States derives essentially by debt, that at some point can not be repaid, posing a danger to financial stability through a credit crunch of large, considerable and systemic scale.

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23 thoughts on “U.S. Treasury 10Y Yield monthly time scale chart powerful MACD signal, can foresee Treasury Yield trendline trailing the Bollinger Band upper bound, for a 2.35% 10Y Treasury Yield, that would test the long term IKH Senkou A/B nuage resistance.

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