Brian Chappatta, Columnist

An Extra $2 Trillion? Treasury Market Says No Problem.

With the Fed buying as many securities as necessary, bond traders have little fear about wider deficits.

March 25, 2020 at 5:11 PM UTC

Brian Chappatta is managing editor of Bloomberg News' leveraged finance and distressed debt teams. He was previously managing editor and team leader of its wealth group. Before that he was a Bloomberg Opinion markets and finance columnist and a bonds reporter for Bloomberg News.

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Photographer: Paul Yeung/Bloomberg

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If there were ever a time for bond traders to be fearful of out-of-control U.S. deficits, it would have been Wednesday.

After all, the Trump administration and congressional leaders agreed overnight to an unprecedented $2 trillion stimulus package to help mitigate some of the economic damage caused by the coronavirus outbreak. No one is asking “how will we pay for it?” The answer is obvious: piling on to the $23.5 trillion national debt.