These days, you’d be hard-pressed to find many people in Washington who are all that worried about the U.S. budget deficit. Republicans seem more interested in tax cuts, Democrats have ambitious spending plans for everything from health care to infrastructure, and Modern Monetary Theory, a manifesto for free-spending governments, is all the rage in progressive circles.

But on Wall Street, bond dealers provided a small, but pointed reminder that, just maybe, debt and deficits do matter after all.

It came in the form of a sudden spike in interest rates for repurchase agreements, or repos, a normally obscure part of finance that keeps the global capital markets spinning. Plenty of factors helped cause liquidity to dry up, but one that’s getting more attention is concern that dealers are starting to choke on Treasuries as the U.S. government goes deeper into the red.

The argument goes like this: Primary dealers, which are obligated to bid at U.S. debt auctions, have absorbed more and more Treasuries to finance the Trump administration’s tax cuts as investor demand has waned. Typically, they rely on repos to fund those purchases by putting up the debt as collateral.

The problem is that with the financial system already inundated by over $16 trillion of Treasuries, banks constrained by crisis-era rules have fewer incentives to participate in repo. Simply put, there was too much new debt flooding the financial system and not enough money, causing lenders to jack up repo rates. The Federal Reserve has moved to inject much-needed cash on a temporary basis, but if left unchecked, the flood of supply in coming months and years could ultimately result in higher borrowing costs for the U.S.

“There’s no down time on the supply front,” said Jim Vogel, a strategist at FTN Financial who’s been following debt markets for over three decades.

The Treasury’s next slate of debt sales comes this week, with a combined $78 billion of 3-, 10- and 30-year auctions starting Tuesday. Yields on the benchmark 10-year note are currently at 1.52%.

Of course, supply wasn’t the only issue. The situation was compounded by corporate tax payments that also siphoned cash out of the banking system.

And to be fair, nobody is suggesting the U.S. faces any imminent problems financing itself. Everywhere you look, government borrowing costs in bond markets around the world are at historic lows. The dollar remains the world’s reserve currency, and with the global economy showing signs of weakness, investors are still likely turn to Treasuries for safe harbor.

Nevertheless, the mid-September repo upheaval is a clear sign there might actually be limits on just how much debt the U.S. can take before triggering more frequent disruptions. Deficits aren’t exactly new, but they do add up. Since the crisis, the market for Treasury debt has roughly tripled in size.

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