Here's Why Speaker Johnson and Trump's "Big Beautiful Bill" Is A Big Bad Idea

Chris breaks down the bond market chaos and its impact on U.S. debt. With $10 trillion in debt to refinance at higher interest rates, the nation faces soaring interest payments and a skewed debt-to-GDP ratio. Can Trump’s fiscal plans survive? www.watchdogonwallstreet.com

Episode Transcript

Speaker 1 (00:00):
The Watchdog on Wall Street podcast explaining the news coming
out of the complex worlds of finance, economics, and politics
and the impact it will have on everyday Americans. Author,
investment banker, consumer advocate, analyst, and trader Chris Markowski.

Speaker 2 (00:16):
All right, I got a lot of questions over the
past past several days in regards to the bond market.
What does this mean, Chris? Why all of a sudden
as Trump concerned about this talking about the yips the hips. Yeah,
the bond market got the yips. Well, you see this

(00:37):
thing that they're trying to pass, this big, beautiful bill, right,
and they got a compromise, Mike Johnson, Senate, and again
you got to give credit where credit is due. Mike
Johnson got a lot of the fiscal conservatives to go
along with this. We have to this year, we have

(01:03):
to refinance ten trillion with a t ten trillion dollars
in debt. You see, people, we don't pay off our debt.
We're thirty six trillion dollars in debt, and we continue
to run deficits. We continue to run deficits. And again,

(01:27):
we are the world's global reserve currency. Correct for the
world's global reserve currency. We're allowed to do this. People
continue to buy our bonds. Other contries can't do this,
can't do what we're capable of doing. We're in a
position that is envied. Let's just leave it at that.

(01:49):
But anyway, neither here nor there. Okay, most of this debt,
most of this debt was again it was much lower
rates at the time. You're talking the amount of money
that we borrowed. This was, you know, back during the
COVID years, really really low interest rates. Well, we were

(02:12):
dumb and we didn't refinance that debt at you know,
much a much longer term, so we have to roll
it over. You see, this is what our country does. Okay,
we don't pay it off. It's kind of like you
use one credit card to pay off another credit card.
So let's pretend that credit card A that we use

(02:33):
during COVID and put ten trillion dollars on that credit
card at let's say three percent, two and a half
to three percent. Now we have to pay it off
with this credit card at four and a half who knows,
maybe five percent. What does that mean? Well, that means

(02:56):
we're paying a lot more in interesting, a lot more
in interest in our debt to GDP ratio gets completely
thrown out of whack. If he could take his big,
beautiful bill and you could basically flush it, you're gonna
need more money. More money is going to be allocated

(03:18):
to interest payments, essentially flushing money down the toilet. That's
where we're at right now. Donald Trump got the yips.
He got the yips because he knows he's in a
real tight position right now. We need these interest rates
to come down. And I know, I know he was

(03:41):
jaw boning Jay Powell about lowering rates. Ain't gonna matter. Okay,
it's not going to matter. He can lower rates, but again,
the bond market's going to do what the bond market
is going to do. And if people start unloading our

(04:01):
debt lack of confidence, guess what, those interest rates go up?
Then what then what? We get ourselves into an even
bigger hole. And I don't know, I don't think that
the fiscal conservatives are going to sign off us, but again,
who knows, who knows, Maybe they'll punt on this again

(04:23):
and just put our nation further and further and further
into debt, putting that on our kids and our grandkid's bill,
which quite frankly, is child abuse if you ask me,
This is the predicament that they put themselves in at
this point time. And the reality is the world knows this.
The world knows this. We need to need to come

(04:46):
to some sort of resolution sooner rather than later. Again,
think about this, Think about the interest payments on ten
trillion dollars in debt. Watch Dog on Wall Street dot
com