Hartnett: US Interest To Hit $1.6 Trillion By Year End, Making It The Largest US Government Outlay

Several days ago, we were the first to point out two new striking developments in the Dollar's crusade to lose reserve currency status: i) after hitting $1 trillion in late 2023, interest expense on US debt rose to a record $1.1 trillion in late March, and ii) while US debt is now rising at a pace of $1 trillion every 3 months, US interest expense is rising at a just as torrid $100 billion every 4 months (this interval will also shrink to three months very soon).

US debt is rising by $1 trillion every 3 months... and US interest expense is rising by $100 billion every 4 months. https://t.co/D2Nkf1WkP2

— zerohedge (@zerohedge) March 28, 2024

It didn't take long for this original observation to make its way to our favorite Wall Street strategist, BofA CIO Michael Hartnett, who in his latest Flow Show note dedicated his entire "Biggest Picture" segment to - you guessed it - the quantum leap higher in interest expense, which also Hartnett correctly notes is a "big motivation" for Powell to cut rates to "constrain the surge in interest costs" which he amusingly calls "Interest Cost Control" policy, borrowing another term we have sporadically used on this website.