Who is funding the US budget deficit? It is shocking how the composition of buyers changes through time. In particular, the QE program took on a lot of the new debt produced over the last three years. Take out the flight to quality component and you have to worry where buyers will come from without extra compensation.
The impact on the Treasury market is even greater when you look at the percentage held by different groups in some years. The Fed's exit strategy is not insignificant.
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