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.

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maerF0x0 7 hours ago | parent | next [-]

> 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

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SoftTalker 7 hours ago | parent [-]

Yep, inflation is just another kind of tax, and one that's quite hard to avoid.

	▲	lenerdenator an hour ago \| parent [-]
		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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jrflo 7 hours ago | parent | prev | next [-]

To be honest though cash hasn't been cheap for a while, not really since 2021. We have been in relatively high interest rates for the entire AI boom. Going from 350-375 to 375-400 won't be a huge shock for hyperscalers. Interest rate are still lower than when many made their initial investments in 2023-2025

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MarkusQ 7 hours ago | parent [-]

Depends on your time frame for "relative to"; rates have been high compared to ZIRP-era, but still moderate to low when compared to historical norms.

	▲	jrflo 6 hours ago \| parent [-]
		I'm referring to ZIRP, since the OP was referencing cheap cash during ZIRP

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ojbyrne 7 hours ago | parent | prev | next [-]

"years ago" seems like the wrong criticism. Today's rate is lower than the rates from December 2022-October 2025. That seems like years ago.

	▲	lenerdenator 6 hours ago \| parent [-]
		Let's say pre-COVID.

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trhway 7 hours ago | parent | prev [-]

>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

looks very similar to 2007-2008 - high rates plus an wide economy segment with very large debt. Now, the interesting question - did anybody "too large to fail" do (or got exposed in some other ways to) leveraged CDS on the hyperscalers bonds and private debt.