On bond vigilantes..
My take. A determined Fed or European Central Bank will always win.
Comment after the Fed bought 5% of the marketable treasuries outstanding in just 2 and 1/2 weeks.
"In light of that kind of firepower, talk of wild west vigilantes can only seem quaint. If market forces have sway it is because they have been invited."
https://adamtooze.substack.com/p/chartbook-newsletter-14
https://realmoney.thestreet.com/articles/05/13/2013/myth-bond-vigilantes
https://www.theguardian.com/business/2015/apr/22/economic-myths-and-tall-tales-the-confidence-fairy-and-bond-vigilante
"What is your prediction for what we are about to see happen? Both for the next 6-12 months and also for the next 5-10 years."
Nest 6-12 months the continuation of current recovery as the effects of the current policy mix (fiscal and monetary stimulus) continue to be felt.
Next 5-10 years I have no idea and do not care as I will be most likely dead by then. However I do not expect the debt to be paid. In my opinion it will be gradually forgotten as its size in terms of a percentage of nominal GDP will be diminishing due to inflation and real GDP growth. That is what happened in the past. At the end of Napoleonic wars British sovereign debt was around 200% of their GDP, and the American one at the end of the WW2 at around 120%.
