detroit & the rising cost of capital

The long end of the curve is blowing out, under pressure from record government debt, upward tick in inflation from the Iran war, and marginal hyper scaler capex spending now coming from debt issuance. Fiscal dominance is the response with the Fed holding the fed funds rate steady to influence the long end and Treasury both shifting issuance to the short end of the yield curve and simultaneously buying back longer dated securities to remove duration from the market. All of which contributes to the rising cost of capital. What does this mean for municipal borrowing and Detroit’s long term fiscal position? Fuck if I know. Come buy ice cream.