US Debt Explosion Could Signal a Prolonged Stock Slump

With US debt at $40 trillion, policymakers may try to inflate their way out of the borrowing burden, boosting long-term yields and risking a 'lost decade' where real stock returns erode even as nominal values rise. Long-duration bonds may no longer hedge equities in inflationary regimes, pushing investors toward shorter-duration bonds, TIPS, and stocks with pricing power, plus tangible assets like gold, natural-resource stocks, emerging-market equities, and commodities to protect against debasement.