Why Governments Keep Borrowing at the Short End

Episode 33 of The Fiscal Policy Podcast explores why government treasuries overwhelmingly borrow short-term debt despite decades of warnings. Lucas and Luna walk through the specific mechanics of how the US Treasury issues bills, notes, and bonds, and why the average maturity of federal debt has fallen from about 70 months in 2001 to under 50 months today. They dig into the trade-off: short-term debt is cheaper but exposes taxpayers to refinancing risk — as the UK learned in the 2022 gilt crisis when a sudden jump in rates forced the Bank of England to intervene. They also look at a case from Japan, where decades of low rates have made short-term borrowing seem costless, but the real risk is locked in. By the end, you'll understand why your government's debt management desk may be the most consequential finance shop you've never heard of. #USDebtManagement #TreasuryBonds #ShortTermDebt #FiscalPolicy #GovernmentDebt #RefinancingRisk #GiltCrisis #BankOfEngland #JapanDebt #MaturityStructure #DebtManagementOffice #TreasuryBills #FiscalPolicyPodcast #FexingoBusiness #BusinessPodcast #Economics #GovernmentFinance #PublicSpending Keep every episode free: buymeacoffee.com/fexingo