Bloomberg Surveillance · Thursday, September 10, 2026
Mike Reid of RBC explains that government transfers and an aging population, particularly through programs like Medicare, are contributing to inflation-protected income and increasing the deficit. These factors are putting pressure on the long end of the yield curve, indicating a persistent problem.
“And a lot of that comes from Social Security, Medicare, Medicaid. And in particular, when you think about Medicare, All of these programs are adjusted for inflation. Social security income is adjusted for inflation. So it's really inflation protected.”
“What's that doing? That is adding to the deficit. And so when you're thinking about the long end of the curve, that's where a lot of this pressure is coming from, the realization that this is not a problem that is easily solved.”