A key shift is happening in the Japanese yield curve.
Yesterday, Japan’s 10Y yield hit 3% for the first time since 1996.
But the more important signal started in early July:
The 2Y yield began rising faster than the 10Y.
That flattening tells us the market is increasingly… pic.twitter.com/RhM9Ni7vWf
— Macro Liquidity by Sunil Reddy (@Macrobysunil) September 2, 2026
Our national debt has now blown past $40 trillion, and Washington's answer is always the same: spend more, borrow more, and hand the bill to the next generation.
I have a different answer. My Six Penny Plan cuts six cents of every dollar the federal government is projected to…
— Rand Paul (@RandPaul) September 1, 2026
Global bond selloff pushes borrowing costs toward multi decade highs
Global bonds continued selling off Wednesday. The U.S. 10 year reached 4.81%, Japan moved above 3%, and Australia reached 5.20%, its highest level in more than 15 years.
The problem is that government bonds set the baseline borrowing cost for almost everything else.
Higher yields mean more expensive mortgages, corporate debt and government refinancing.
And governments are already carrying record amounts of debt.
IMF says global public debt is approaching 100% of GDP
The IMF now says worldwide public debt is almost 100% of global GDP, above the post World War II high.
The IMF also says the energy shock isn’t over, the Strait of Hormuz remains largely closed, and debt is expected to keep climbing.
That is a particularly ugly combination because governments are facing higher borrowing costs at exactly the time they need more money.