Guggenheim's Minerd Sees 'Crowding-Out Effect' in Treasuries

The video discusses the US government's increasing issuance of long-term debt and its impact on investment strategies, particularly in fixed income. It highlights the significant rise in debt issuance in the mid-term range and the flattening yield curve. Concerns are raised about the crowding out effect, where large treasury borrowings may hinder other borrowers' access to capital. The video also questions how future deficits and a shrinking Federal Reserve balance sheet will be financed, given the current US savings rate.

What is the primary focus of the US government's recent debt issuance strategy?

• Short-term debt

• Long-term debt

• Medium-term debt

• No new debt issuance

How does the increase in debt issuance affect the yield curve?

• It steepens the yield curve

• It flattens the yield curve

• It has no effect on the yield curve

• It inverts the yield curve

What is a potential consequence of the Treasury's increased borrowing?

• Crowding out effect on other borrowers

• Increased access to capital for private borrowers

• Decreased government debt levels

• Lower interest rates for all borrowers

What is the estimated US deficit for the next year?

• $1 trillion

• $1.5 trillion

• $2 trillion

• $500 billion

Given the US savings rate, what is the concern regarding Treasury debt?

• There will be a surplus of buyers

• There will be a shortage of buyers

• The savings rate will increase

• The savings rate will decrease