If you listen to the media this week cheerlead the passage of the 1.9 trillion dollar “stimulus” this week, and the subsequent all time high in the S&P 500, you may think this is a big win for the Biden Regime.

However, this totally debt driven “stimulus” is a sugar high that is doomed to failure and may be looking at a highwater mark in equities for the foreseeable future and the moment that marks the beginning of the end for Biden and the Dems.

You see there is a limit to how much any nation can borrow, even if you are the world’s reserve currency and can print more dollars out of thin air.

If the private market is not buying your debt at a speed that matches your borrowing, the price of your debt will fall and the yields will rise. That is exactly what we are seeing on the all important 10 year treasuries which closed at 1.725%, up another 6.15% for the week of March 14th to March 19th. At this rate the 10 year is on a collision course for 2%.

As the benchmark yield rises, that pushes up the cost of borrowing for everyone. Corporate debt will get more expensive, mortgage rates will rise, auto loans will become pricier, small business loans will become harder to underwrite, stocks will be valued against a higher discount rate which will by definition bring down values, etc.

The S&P sold hard in the last week of January and February but was ultimately saved, perhaps based on the anticipation of the big Stim. But that cat is out of the bag and the rising interest rates are clear as a bell. Even with the “all time highs” hit in the S&P this week, the Nasdaq struggled.

If the powers that be can not pull a rabbit out of the hat to save the markets for a 3rd time, then next week could get ugly very quickly.