🇺🇸Treasury’s Elite Bond Dealers Will Struggle to Handle $50 Trillion Debt [long read] Bloomberg reports that as US debt balloons, firms that play a vital role in ensuring the biggest bond market works properly warn of the risk of growing pressures. 👤Formed in 1960 by the New York Fed to ensure the smooth functioning of a Treasury market that has since grown to nearly $29 trillion and is a benchmark for setting borrowing costs across the world, the current system of primary dealers stands at two dozen, about half the number at its peak in 1988. 📉Primary dealers are seen as the ultimate backstop at auctions because they are required to bid for at least their pro-rata share of the total issuance. They are beefing up market guardrails, with a move to more central clearing of Treasuries and other efforts to facilitate trading. 📈 The amount of Treasury debt outstanding has exploded by more than $15 trillion in the last decade, and the nonpartisan Congressional Budget Office projects chronic US deficits will lift US public debt to just over $50 trillion by the end of 2034. 📊For primary dealers, the issue boils down to whether they can keep up with a gushing spigot of Treasury sales. Primary dealer holdings of US Treasuries reached an all-time high of almost $400 billion. In 2014, dealers’ holdings averaged $43 billion. 📌Relevant: 📎 Trump Should Reform Financial Watchdogs. Here’s How 📎 A New World Order Is Here, and It Looks a Lot Like Mercantilism 📎 Dollar Dominance Is the Key to US Debt and Deficits Read full: ⬇️⬇️⬇️ en review.uz/en/89c ru review.uz/89c More analytics ⬇️⬇️⬇️ © Экономическое обозрение © Иқтисодий шарҳ © Economic Review telegram | facebook | twitter|linkedin