How Big Tech's Bond Spree and Rising US Debt Are Creating Risks and Opportunities

How Big Tech's Bond Spree and Rising US Debt Are Creating Risks and Opportunities

Is a global debt emergency on the horizon?

Big Tech’s bond-issuing spree is helping to pay for its massive artificial intelligence buildout. And it’s not expected to slow down this year. Meanwhile, the US federal deficit has swelled to about $39 trillion, according to the US Treasury Department. That’s raising red flags about the potential impact on the Treasuries market. Government and corporate debt are growing but for different reasons. How should investors think about it?

Dominic Pappalardo is the chief multi-asset strategist for Morningstar Wealth. It’s part of registered investment advisor, Morningstar Investment Management.

Why Bonds Still Have Long-Term Appeal Despite Recent Wobbles

On this episode:

00:00:00 Welcome

00:01:29 Big Tech's AI bond-issuing spree explained

00:03:51 What's driving the US federal deficit higher

00:06:04 Calls to prepare for a bond market emergency

00:07:38 Government vs. corporate debt key differences

00:08:45 Potential risks lurking in today's bond market

00:10:33 Bond portfolio opportunities and investor takeaways

Watch more from Morningstar:

10 Exceptional Stocks With Double-Digit Dividend Raises

Investors May Be Ignoring Big Market Disruptions. Is There Risk to the Rebuff?

Vanguard Wrote the Playbook for Success. Now, It Must Evolve to Stay on Top

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