U.S. Next Bear Stearns?

Trennert sees two possible explanations.

“First, you want the deficit to look as low as possible now, so you keep your interest expenses low,” Trennert said.

“The other reason is more frightening. Marginal buyers of debt, in particular the Chinese, have shown they don’t want to lend long-term. They want the leverage that comes with having Uncle Sam go back to them every week or two.”

That means the deficit could represent a national security issue, Trennert says. “I don’t want to be overly conspiratorial, but certainly you’re conceding some sovereignty when you fund yourself this way.”