The past decade has been marked by extremely low interest rates in the financial world. After the 2008 financial crisis, near-zero interest rates were used as a means to revive the faltering global economy. Now it seems that these extremely low interest rates have been maintained for too long. According to Spencer Hakimian, the American people will now be presented with the bill.
And the solution? According to Hakimian, there are two ways: gold and Bitcoin.
The United States has a $66B 10 Year Bond from February 2015 coming due tomorrow.
It had a 2.00% fixed coupon.
It is going to be replaced with another $66B 10 Year Bond, but this time, with a 4.55% fixed coupon.
This one single rollover will add an extra $1.67B per year to the… pic.twitter.com/lCQre6FURS
— Spencer Hakimian (@SpencerHakimian) February 11, 2025
America pays the bill
“For the United States, a 10-year Treasury bond from February 2015 worth $66 billion expires tomorrow. These bonds had an interest rate of 2.00% and will be replaced by a new tranche of the same size, but with an interest rate of 4.55%.
This debt restructuring will increase the American national debt by $1.67 billion annually over the next ten years. Such bond auctions take place every day.
We are only just beginning to pay the bill for ten years of artificially low interest rates,” said Hakimian.
All this debt is now costing taxpayers money, he notes. “Just wait for the period 2032 to 2035, when we have to pay 5% interest on all the debt we took on when unemployment was 4% and real economic growth was 3%,” the fund manager continued.
Is there a solution to this problem?
It seems very difficult for the United States to find a solution here.
However, Hakimian has a personal recommendation: “There is only one true strategy here. You have to own hard money. Gold (for risk-off phases) and Bitcoin (for risk-on phases). Buy both. And also buy stocks as long as policymakers continue to overheat the economy with borrowed money (which is fantastic for stocks as long as it lasts).”
What do you think? Will Hakimian be right, or will Elon Musk and Donald Trump make such drastic savings with DOGE that America will get its finances back under control?
