Can the Federal Reserve Keep Rates High Without Breaking Something?

And what could be the implications for BTC as the Fed heads into next week's FOMC meeting facing a highly uncomfortable trade-off. Although the US Federal Reserve is widely expected to leave interest rates unchanged at its upcoming October 27-28 meeting, the bigger problem remains. Inflation is still stubborn, oil is well above $100, and US borrowing costs are becoming increasingly painful as federal debt and interest expenses climb to record levels. Can the US economy survive such a macro landscape? Can the US Afford Higher Rates? The dilemma presented by the analysts at the Kobeissi Letter argued that if interest rates average 150 basis points above the Congressional Budget Office’s February baseline projection through 2036, cumulative US deficits could increase by roughly $6 trillion. Citing the CBO’s data, they added that public debt could consequently reach 133% of GDP, while the annual deficit could climb to 8.8% of GDP. Even a comparatively modest 50-basis-point overshoot could add close to $2 trillion to deficits and push debt to 124% of GDP. The Committee for a Responsible Federal Budget reaches the same conclusion: sustained high borrowing costs would materially worsen an...