Post-Cliff Bonds

Borrowing costs for the United States ticked up in the aftermath of yesterday's budget deal.  At last check, rates on the 10-year were at 1.84% today (Jan. 3, 2013).  Last month the rate was 1.60%.  Last week it was 1.73.  There has not been much change in the shorter-term Treasuries, but the 30-year is up some as well.  

Overall a person might think that those buying bonds are slightly less confident in the good faith and credit of America.  We're still a long way from Greece, Spain, and Italy in terms of rates, but how much of that is because of the Fed's bond-buying spree?  If we really put our debt out in the market, does anyone think the rates would be that low?  Would anyone at all be buying substantial quantities at anything under five or six percent?

Meanwhile fools like Chris Christie think that the rest of the country should take on more debt to benefit the northeastern blue states who suffered so much in the "super storm".  We are not going to be able to fix anything until we stop spending more than we take in.  I know there's very little math in law school, but even a former prosecutor like Christie should be able to understand the arithmetic involved in getting blood from a turnip.

We ain't got no money.

I may have mentioned this before, but I'll offer it again.  We often hear that the blue states like California and New York send more money to Washington in tax revenues than they get back from the government in handouts.  This is supposed to prove that red states like Missouri and Kansas are biting the hand that feeds them, or something.  But where are corporate headquarters located for the most part?  Silicon Valley, New York City, Seattle, etc., are the addresses used to pay corporate taxes to the IRS.

Sure, there are a lot of older retired folks and veterans receiving government checks out here in flyover country, but we do not have the nanny-state-dependent populations of Philadelphia, Cleveland, New York, Los Angeles, San Francisco, and the rest.  Apple and Goldman-Sachs send lots of money to the Swamp, based on their profits, executive salaries, and such, to pay for Iowa (a reliable blue state itself) farm subsidies.  Corporate headquarters are going skew the calculations and make it look as though those who vote for freedom are actually more "government-dependent" than those who vote for tyranny.  I'm not buying it.

But, if they think that is the case, I'm more than willing to accept an amicable separation, and we can see who squeals first.