Ex-FED Janet Yellen finally catches up with Peak Stupidity


Posted On: Saturday - January 10th 2026 10:36AM MST
In Topics:   Global Financial Stupidity  Economics  US Feral Government

… but she’s got a professional Economist’s technical term* for it, so there’s that. Fiscal Dominance is going on, my friends. Gasp! Is it worse than the COVID one-niner?! By far, yes, it is.



The Unz Review commenter ePebble excerpted a lot of a recent Fortune magazine article by one Eve Roytburg, Janet Yellen warns the $38 trillion national debt is testing a red line economists have feared for decades. Here’s what this Fiscal Dominance is (thankfully, nothing involving Mr Yellen and whips & chains):
Fiscal dominance is the point at which financing needs begin to constrain the central bank’s inflation fight, and the adjustment happens through the purchasing power of money rather than through taxes or spending cuts.

Imagine the U.S. economy is a car, with the Treasury as the driver, ready to spend money at the government’s behest, and the Federal Reserve is the brake, ready to raise interest rates to slow inflation if the Treasury spends too much. The car is now towing a $38 trillion trailer. The weight is so heavy that if the Fed hits the brakes too hard, the brake pads will explode from the pressure (the government’s interest payments will become too expensive, causing a default). So, to prevent the car from crashing, the Fed is forced to let off the brake, even if the car is speeding toward the cliff of over-spending. The result: hyperinflation.

At a panel hosted by the American Economic Association on Sunday, Yellen said she worries the U.S. might be getting to the point where the car is too heavy for the brakes to work.
Let’s stop here before the brake analogy** brakes down even further…

Is it OK to have a post consisting entirely of only the two words No shit!? I’m not Yellen here, but, man we’re been writing about this obvious arithmetic certainty for years here. Yet, I’ve been neither the FED Chairman nor the Treasury Secretary, as has Janet Yellen.

Without all that financial expertise around us, Peak Stupidity has written a number of posts based on the simple little pie charts near the back of the IRS 1040 Instruction booklet .pdfs that show very basic revenue and expenditures – the first was one 8 1/2 years ago: Quick glance at the budget from US-Gov crack Green-eyeshade boys. Check our Economics topic key for more.

Indeed, that little piece of pie called “net interest on debt” used to be a little morsel at 5-6% or so, BUT at FED-set interest rates (based on the mixture of bonds redeemed) of 1.1% (one of the other sets of pie grapsh.). Were that to be a number that Janet Yellen is FINALLY worried about, yeah, a more natural rate of 7% would bring the pie slice up to 30-40% or probably higher now that the debt is up to 38 1/2 $Trillion.

It might have been helpful if Janet had wised up*** back in ‘14, her first year as FED Chairman, when the national debt was “only” $18 Trillion. She could have foreseen the problem and maybe told somebody who probably wouldn’t have done … I guess she doesn’t do her own taxes, so she didn’t do this arithmetic.

We are very much looking forward to the newest IRS provided pie charts, which will show the ‘24 fiscal year’s Fiscal Dominance. They are probably already out. A post is forthcoming…



* It’s not like anything in Economics is technical in the scientific/engineering, I.e. REAL, sense, but it gets worse than this with the use of the term in the “trading” world.

** Exploding brake pads, you say? You would expect them to lock up back in the day before anti-skid, but friction permitting, they’d get hot and “fade”. Brakes don’t normally explode. Economies can. I would say, stay in your lane, Economists, but they’re off into the rumble strips…

*** Yeah, another obscure old movie reference there.

Comments:
Moderator
Sunday - January 11th 2026 3:22PM MST
PS: OK, we'll use that one, thanks. I like Phil's bass on the song very much too.
Ganderson
Sunday - January 11th 2026 9:03AM MST
PS

Music Never Stopped 2/3/78, University of Northern Iowa UniDome, Cedar Falls, IA

https://youtu.be/lYAJW-QQh64
Moderator
Sunday - January 11th 2026 6:21AM MST
PS: I heard it from you first, here, that is, Mr. Anderson. He and Phil then, lived on and played without Jerry about the same length of time they played with him, 30 years.

Thanks for the Bobby art, Mr. Smith. I’ll paste that in Monday with what I’ll consider his best, though hard to pick only 3 or so.
Adam Smith
Saturday - January 10th 2026 6:33PM MST
PS: RIP in Peace, Bob Weir. ☮️



⠀⠀⠀⠀⠀⠀⣠⡴⠶⠶⢶⣴⡞⠷⣦⣀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⢰⡟⠀⢠⠊⡝⢻⣰⡶⡀⠉⠳⣦⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⣿⠀⢀⠇⣸⡾⠿⠿⠿⡇⠀⠀⠸⡆⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⡾⠃⠀⠸⢸⣷⠀⠀⠀⠀⡟⣦⡀⠀⢹⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⣧⠀⠀⢀⢸⢿⠀⠀⠀⠀⠃⠀⢹⡏⢹⡇⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⢸⠀⠀⠸⢸⡌⠆⠀⠀⠀⠀⡀⢸⢰⠈⣇⣀⣠⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⢰⣄⣼⠆⠀⠀⢸⡇⠀⡀⠠⡤⠐⠓⠚⣇⠱⣬⣽⠃⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⢠⣄⣤⠽⠎⠀⠀⠀⣼⠢⣖⣳⡴⣷⡯⠭⠭⣾⠀⠈⠛⠒⣿⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⢸⣇⠀⠀⠀⠀⣠⢾⡅⢦⢒⢙⡇⢸⣍⢉⡾⠹⡤⡤⡴⣣⡏⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠻⣷⣆⣀⣤⣤⣾⠃⠀⠉⠉⢰⡈⡆⠀⠀⡼⢱⡗⣷⡿⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠈⠓⢻⡛⢹⣯⢳⣀⠂⣰⠮⡤⠿⣆⠈⡅⣼⣼⡴⠃⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠙⣟⣾⣧⣯⠖⠁⠀⣷⣄⠈⠑⠾⣽⣫⣴⡆⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠳⣌⡁⡀⠀⣠⠾⣿⣭⠷⢤⣠⣠⡴⠋⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⣀⣀⣠⢽⢿⣍⠁⠐⠙⠈⠀⠀⡽⢮⣅⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⡞⢉⠀⠀⢾⡿⡷⠴⢶⣦⣤⢼⡗⣻⠀⢸⣦⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⣼⢃⠈⢠⠀⠀⠈⠎⢩⣶⠙⠰⠛⠊⢱⠀⣾⣿⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⢀⡼⠃⠀⠑⢿⠀⠀⠀⠀⠀⠘⢆⡆⠀⠀⠘⡾⢸⡇⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⢰⣏⠀⠀⢠⣱⢿⣇⠀⠀⠀⠀⠀⠈⠧⠀⠀⢸⣧⡞⡇⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⣴⠋⠛⣲⠗⠋⠈⣿⠀⠀⠀⠀⠀⠀⠀⠀⠀⠘⣿⡾⢷⡆⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠈⢷⡦⡌⠱⣄⠀⣿⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⣿⣧⣸⠇⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠈⢳⣿⣆⠘⢿⣍⡉⡓⢦⣄⠀⢀⣤⠶⡚⠉⢉⣷⡏⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⣀⠀⣀⢀⣀⡀
⠀⠀⢀⡾⠻⠲⡈⠳⢍⣛⠓⠊⠉⠉⠀⢋⠔⠋⡏⠸⣶⣻⣀⣠⡤⠤⠤⣤⣤⣶⣶⣾⣭⣿⣽⠋⡹⢫⠇
⠀⢀⡞⠀⢀⣀⣧⣀⠀⡈⢷⣦⣯⣷⣻⣍⣩⣿⣿⣿⡻⡙⠽⣟⠿⠿⠏⠛⠛⠛⠉⠙⢺⣖⢗⡖⣶⠋⠀
⠀⢸⣿⣿⢿⠧⠿⠳⣗⣪⣽⣯⣿⣯⣻⣉⢉⡩⣿⣜⣇⣡⡼⠞⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠸⡇⠀⠀⢀⡰⠆⢰⣿⣿⣿⣟⣋⠹⣶⢖⣲⡞⠈⠁⠁⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠻⣄⠘⠊⢡⠴⠛⢛⣻⠟⠋⣉⣙⠏⠈⢻⠁⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠈⠳⠦⣤⣤⣶⠟⠁⠀⠀⡿⣥⠀⠀⠸⡄⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠀⠀⢸⣄⣄⣄⣀⢿⢱⣦⢤⣤⡷⡄⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠀⠀⠈⢻⡍⠉⡟⠋⠈⢷⠀⠀⡇⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠀⠀⠀⢈⡇⢰⠃⠀⠀⢸⣇⠀⡇⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠀⠀⠀⠈⡗⠘⡆⠀⠀⢸⠃⢻⠃⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⡇⢸⠀⠀⠀⢸⡄⢸⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⡇⣸⠀⠀⠀⠘⡇⢸⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠀⣠⡴⣿⡓⢾⣦⣶⣮⣷⠓⢼⠹⠶⣲⣄⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⣼⠿⣓⣦⣲⠟⠋⠙⠉⠻⠿⠿⠿⠿⠿⠟⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀
⠀⠀⠀⠀⠀⠀⠈⠉⠉⠉⠁⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀⠀


Ganderson
Saturday - January 10th 2026 5:36PM MST
PS
OT Bob Weir will not be down for breakfast.
WHAT SAY YOU? : (PLEASE NOTE: You must type capital PS as the 1st TWO characters in your comment body - for spam avoidance - or the comment will be lost!)
YOUR NAME
Comments