Pop Quiz. As of June 5, what was the yield on a 10 year U.S. Government bond? Here’s a hint. When voting against raising the government debt limit, Rep. Mo Brooks said “We face national bankruptcy and insolvency”. Another hint – the current yield on Greek 10 year government bonds is 16.25%.
The answer to the pop quiz is that US 10 year bonds yield is 3.125%.
The answer means two things. First, those people who invest for a living continue to believe that US obligations represent one of the safest risks on earth. Second – Mo Brooks is exaggerating the mess we are in.
Certainly, our debt and deficit problems must be addressed, but the confidence that the financial markets continue to place in the US give us the time to address our deficit issues smartly.
What would not be smart? Lowering income taxes on capital gains, dividends and interest to ZERO when we are facing historic deficits. How about supporting a deficit reduction plan that, by its own questionable accounting, does not balance the budget for several decades? Yet these are the policies that Mo Brooks voted for in his support of the Ryan budget plan.
Rep. Brooks talks tough about deficits. But his voting record so far shows that more tax cuts for the wealthy are really at the top of his agenda. What do you call someone who says one thing and does another? I’d call him Mo.
