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Fed hikes rates as inflation worries push up bond yields

184 points · 250 comments · wslh

  1. lenerdenator · · focus · HN ↗
    Should have been this high years ago.

    The country - particularly this industry, information technology - got addicted to cheap cash. Worse, people didn't want to pay any of it back in tax, so bond yields are going to go up on the debt that was issued to cover deficit spending.

    Should be interesting to see how this impacts the AI hyper-scalers. They were already burning through cash like a furnace and were running out of people to borrow from, thus the IPO hopes.

    1. maerF0x0 · · focus · HN ↗
      > want to pay any of it back in tax

      If they dont pay it back in tax, they pay it back in debasement of their savings and entitlements

      1. SoftTalker · · focus · HN ↗
        Yep, inflation is just another kind of tax, and one that's quite hard to avoid.
        1. lenerdenator · · focus · HN ↗
          If you look at the kind of person who makes massive donations to politicians and initiatives that are about massive tax reforms (think Missouri's recent ballot question about introducing a state sales tax and eventually sunset its income tax) you'll notice that a lot of them are very wealthy people who have very, very few people that they have to answer to in their lives. The one exception, it would seem, is the tax man, and they absolutely hate that.

          Market forces like inflation aren't a person exerting control over them. They're the results of humans acting within social structures. These people have control over social structures; they're the elite. They can counter that market force with some other market force. Taxes? That's cold, hard math. There's no way around it, no feeling of agency to be had. So while it might be harder to avoid, it's not the financial effect that they worry about, because they have enough money to weather that. It's the feeling of obligation and powerlessness in the face of others that they can't brook.

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