U.S. Treasury Yields and Dollar Trends Pose Risks to Assets

According to BlockBeats, Bank of America's chief strategist Michael Hartnett highlighted in his latest report the staggering scale of U.S. government spending, noting that spending $100 every second would take 2,248 years to match the $7.1 trillion spent by the government in the past year. As the "Great Beauty Act" progresses, Hartnett tactically anticipates that rising U.S. Treasury yields and a declining dollar (with 30-year Treasury yields exceeding 5% and the dollar index falling below 100) will negatively impact risk assets. Last week, the cryptocurrency market saw an inflow of $2.3 billion, reaching a new cumulative high, while U.S. tech stocks experienced an epic outflow of $6.8 billion. Additionally, high-yield bonds attracted $9.8 billion over the past four weeks, marking the highest level since November 2023. Hartnett sharply warned that a collapse in long-term U.S. Treasuries and the dollar could spell disaster for U.S. stocks. A Treasury yield above 5% poses significant risks to the highly financialized U.S. economy. When the five-year Treasury yield exceeds 3.25%, the U.S.'s $1.2 trillion interest payments will worsen rapidly. However, if yields remain below 3.25%, the cost of U.S. debt may stabilize.