Deutsche Bank, citing Finaeon data, stated that the average yield on 10-year US Treasury bonds has been around 4.5% since 1800, so the current level of around 5% is not historically abnormal. However, "normal yields" do not equate to normal financing pressures. Long-term low interest rates are already ingrained in stock valuations, mortgage lending, and government and corporate financing structures, while US debt now exceeds $40 trillion, and bond supply is also increasing.
Therefore, while a nominal yield of 5% is not uncommon historically, in the current environment of high debt and high valuations, its interest burden and asset revaluation impact may be far higher than historical averages.
