How the highest bond yields in 16 years could chill the hot U.S. economy

“Wendy Edelberg, a former CBO chief economist, said higher interest expenses will ultimately force policy makers to choose if they will accept higher borrowing costs, will raise taxes or curtail spending. Spending more on paying old debts, she said, will weigh on private investment—but won’t necessarily cause a crisis. ‘We need to decide what we think is the most effective way to finance those interest costs,’ Edelberg said.”