The Graveyard of Empires
Addison Wiggin / May 30, 2025
Before the Senate puts its signature on the “One Big Beautiful Bill,” it might want to take a sobering look at a number not printed in any campaign flyer: $6.74 trillion.
That’s how much U.S. government debt comes due by the end of year — about one-quarter of the total marketable Treasury pile. Short-term borrowing is cheap… until it isn’t.
You may recall: ahead of last fall’s election, former Treasury Secretary Janet Yellen took flak from economists like Nouriel “Dr. Doom” Roubini for ramping up short-term debt issuance. Critics accused her of juicing the economy while deferring the bill.
Yellen, for her part, denied any deliberate manipulation — but the result was the same: a heap of IOUs due in 2026, with interest rates no longer playing along.
Now, Treasury Secretary Scott Bessent gets to lie awake at night watching interest costs exceed defense spending – with or without Trump’s proposed Golden Dome.
The ancient Greeks had a word for this kind of moment: hubris — a pride so large it defied the gods.
America, in the second term of Trump, appears ready to test the boundaries. Seas renamed. Borders redrawn. Trade weaponized. The president even floated resettling Gaza wholesale. His “peace” plans look a lot like imperial partitions.
But if the gods won’t humble us, the bond market might.
The Debt-to-Defense Crossroads
In 1767, Scottish political theorist Adam Ferguson sounded the kind of alarm that still echoes in bond markets today.
Public debt, he wrote, is “extremely dangerous… in the hands of a precipitant and ambitious administration.” Though borrowing lets governments “spread the cost over multiple generations,”
Ferguson saw the real risk: “The growing burden is gradually laid, and though a nation may sink in some future age, every minister hopes it may still keep afloat in his own.”
His conclusion: “An expense, whether sustained at home or abroad, whether a waste of the present, or an anticipation of future revenue, if it bring no proper return, is to be reckoned among the causes of national ruin.”
Fast forward: U.S. debt has hit $37 trillion, long-term Treasury yields are nudging 5%, and traders are shorting duration like it’s 1979. Congress debates spending trillions more – ignoring DOGE findings which could save hundreds of billions annually – while the cost of borrowing quietly devours fiscal maneuvering room.
Again, no gods needed — Ferguson’s prophecy may do just fine.
Trump’s Golden Dome Rockets Forward…
With an estimated price tag of over $10 billion…
Trump’s Golden Dome could send a certain Nasdaq-listed stock blasting higher.
But where will the missiles be anchored — in New York, Los Angeles, Boston, or Seattle?
(Hint: Trump’s likeliest location will shock you.)
Click here for the urgent details >>
Tariff Ping-Pong Continues
Trump’s tariff playbook hit a speed bump this week when a federal trade court ruled that his sweeping “Liberation Day” duties exceeded presidential authority.
But an appeals court offered a temporary stay, keeping the levies alive while the legal battle climbs toward the Supreme Court.
The White House is preparing fallback strategies — 15% tariffs for 150 days under obscure provisions, or industry-specific measures via Section 232.
The message to trading partners? Don’t get comfortable. Negotiating with the U.S. now means checking which laws the president is invoking this week. But it’s full speed ahead otherwise.
Trump Pressures the Fed
President Trump also sat down with Jerome Powell at the White House yesterday, once again urging the Fed chair to cut interest rates. Powell demurred, reiterating that monetary policy decisions are “non-political.” The central bank has resisted Trump’s overtures so far this year.
A month ago, Trump flirted with firing Powell, but the Supreme Court said no dice. Still, the message is clear: the executive branch sees lower rates as the key to sustaining growth — even if it means leaning on the Fed’s “independent” arm.
CEOs Hit the Panic Button
The Conference Board’s Measure of CEO Confidence just cratered 26 points in Q2, falling to 34 — the lowest since late 2022, and the largest single-quarter drop since the survey began in 1976.
A reading below 50 signals more pessimists than optimists.
This quarter? 84% of CEOs said economic conditions are worse than six months ago (up from just 11% in Q1). And 64% expect things to get even worse over the next six months.
A full 83% of CEOs now predict a recession in the next year to 18 months. One in eight expect it to be deep, with global spillover. Don’t tell the stock market – which is still within sight of all-time highs.
Market Shrugs, Stocks Climb
Despite all the noise, the S&P 500 is wrapping up its best May since 1990.
Nvidia’s earnings this week – and a boatload of retail investors’ capital – helped. So did the general belief that chaos is already priced in.
A fun side note: beauty brand E.l.f. surged after acquiring Hailey Bieber’s skincare line for $1 billion. Nothing like celebrity skincare to distract from a $37 trillion national debt.
China’s Student Exodus
An obtuse outcome of protectionism: American universities — already struggling with enrollment and budget gaps — just lost a crucial customer base.
Chinese students are opting for friendlier destinations like Finland, Australia, and Singapore. The reason: The Trump administration is aggressively revoking student visas and telling embassies to stop issuing new ones.
Secretary of State Marco Rubio says the move targets “national security threats.” But for U.S. higher ed, the fallout is material — tuition losses, reputational hits, and a fraying bridge to one of the world’s most “educated” middle classes.
United + JetBlue: Merger Vibes Without the Paperwork
United wants back into JFK. JetBlue wants relevance after its Spirit merger got iced. The answer? A new alliance that lets customers book perks across both carriers and gives United a runway back into New York by 2027.
It’s not a merger, but it’s not not a merger either. The partnership will draw antitrust scrutiny, but the airlines are gambling that regulators are too distracted with AI, crypto, and tariff chaos to notice.
Meta and Anduril Suit Up for the Pentagon
Mark Zuckerberg is partnering with Anduril (the company, not the sword from Lord of the Rings) to develop AI-powered mixed-reality headsets for U.S. soldiers.
Palmer Luckey, who founded Anduril after getting booted from Meta, now gets access to his old designs again. “I got my toys back,” he said.
The wearables promise better vision, enhanced hearing, and battlefield AI integration. Somewhere, Eisenhower is muttering, “I warned you about the military-industrial complex.”
The Empire’s Bet
Donald Trump, ever the hero in his own story, has launched an audacious gambit: torch the postwar global order, then rebuild it in the image of McKinley’s America — low taxes, low interest rates, low and equal tariffs.
A reboot of the Gilded Age, only this time powered by AI, bitcoin, and jet-speed industrial policy.
But it’s not just legacy institutions on the line. He’s thrown the American consumer — and the middle class — into the pot as collateral. In Trump’s wager, prosperity returns not by preserving the system, but by breaking it and recoding it with 21st-century tools.
The question now is whether the same bogeyman that’s stalked every overreaching empire — debt, disorder, and democratic backlash — will let him finish the job… or call the bluff before the chips fall.
~ Addison
P.S. Yesterday’s Grey Swan Live! is posted for our paid-up members. This week’s bitcoin conference, replete with a speech from sitting Vice President, JD Vance, and new developments integrating bitcoin into capital markets, made for a historic week – and our man Mr. Packer was there to give his insights.
He’ll have more details covering the final day of the conference and what bitcoin’s mainstream moment means in our upcoming June issue. There’s never been a better time to become a paid-up fraternity member to get access to our top insights and the best investment ideas to navigate today’s markets.
Your thoughts? Please send them here: addison@greyswanfraternity.com