The yield on the US 30-year Treasury bond has approached 5%, igniting concerns about inflation and its impact on borrowing costs. This increase is largely attributed to rising oil prices due to the ongoing US-Iran conflict, which investors fear could exacerbate inflation. The US economy's resilience, despite high interest rates, and persistent fiscal deficits have led to increased debt issuance, pushing public debt over 100% of annual gross domestic product. As a result, traders are reevaluating expectations for Federal Reserve policy, with some now anticipating potential rate hikes instead of cuts. This shift in sentiment is notable, as rising long-term Treasury yields during a rate-cutting cycle is rare. Furthermore, sustained high yields could lead to increased borrowing costs for mortgages, credit cards, and corporate loans, affecting economic growth. The geopolitical climate in the Middle East complicates the inflation outlook, with oil prices hovering near $100 per barrel. Despite these challenges, US equities have shown resilience, bolstered by strong corporate earnings and enthusiasm for artificial intelligence investments. However, historical trends suggest that rising bond yields may precede economic downturns, making the current situation particularly precarious for investors.