France In Chaos: America's Debt Crisis Could Be Next | Matthew Piepenburg

CoreWeave

Across the shows: 23 speakers in other episodes, 6 bullish and 17 bearish calls, past 30 days

• Matthew Piepenburg · VON GREYERZ AGBearish

  CoreWeave's debt-fueled AI build-out is a warning sign; its credit and stock look unsustainable.

  He calls CoreWeave a canary in the coal mine for AI debt. It has taken on more than $51B of debt and obligations to finance its AI infrastructure build-out, and its credit stress has spiked. He says its insiders, including the CEO, are selling billions in stock gradually because they see the valuations and bond risk as unsustainable. He compares this to the 2000 IPO bubble, when insiders sold once they could. He calls CoreWeave's credit junk-like despite the investment-grade label, and says retail bondholders are left holding the bag.

  “I think Corweave is a very important canary in the coal mine.”at 22:32

Oracle

Across the shows: 11 speakers in other episodes, 0 bullish and 10 bearish calls, past 30 days

• Matthew Piepenburg · VON GREYERZ AGBearish

  Oracle's bonds trade well below par, showing its AI-linked credit has become junk-like.

  He groups Oracle with other former sacred cows whose bonds now trade well below par. He calls these companies junk-bond status despite past investment-grade standing. He presents Oracle as an example of the hyped valuations and credit risk spreading through AI-linked firms, not an isolated case. This matches the wider financing concern the show raises around Oracle's data center projects.

  “that includes even frankly, Oracle or Paramount or other companies now, they were once sacred cows that are offering bonds well below par.”at 25:35

US deficit & government debt

• Matthew Piepenburg · VON GREYERZ AG

  US is already in a debt crisis: $40T debt, 10-year above 5%, $3B daily interest.

  He argues the US is already in a debt crisis. US sovereign debt is about $40 trillion, the 10-year yield is above 5%, and interest costs exceed $3 billion a day. Debt was about $23 trillion six years ago with a yield near 0.5%, so the interest burden is multiples higher in 2026. He adds debt-to-GDP above 120% and a 7% current account deficit. He cites the weakest Treasury auction attendance in 20 years, where $39B sold at 5.93%, as evidence that the US is borrowing at the highest rates of the 21st century.

  “Just look at The United States. 40,000,000,000,000 in sovereign debt with a ten year yield above 5% that forces you to pay over 3,000,000,000 a day on interest expense alone, that is a debt crisis.”at 19:07

• Matthew Piepenburg · VON GREYERZ AG

  US debt is too large to outgrow; no stablecoin or gold fix works, so spending cuts are needed.

  US debt is far above tax receipts and GDP, so growth cannot close the gap, and he says even war cannot. He says the government will have to debase the currency to shrink debt relative to GDP, which he calls an invisible tax on ordinary citizens. He rejects stablecoin demand, gold-backed bonds, and gold revaluation as fixes. He says the only real option is dramatic spending cuts, which politicians will not make.

  “there is no easy way out of this much debt, and there is no stable coin solution, not even a gold revaluation solution will save it. What you have to do is dramatically cut your spending”at 47:45

• Matthew Piepenburg · VON GREYERZ AG

  A Fed-engineered Treasury debt restructuring capping yields is possible, per Gundlach's view he finds plausible.

  He describes Jeffrey Gundlach's scenario: extend bond maturities, stop issuing long bonds, and cap yields near 1%. He calls this a de facto default that would cause chaos in bond markets. It would inflate away debt with a weaker dollar and crush pension, annuity and 401(k) holders. He says he thinks it is possible and that the government would not care about the harm to bondholders.

  “So I think there's a possibility of a restructuring. And again, that's not a coup from the gold camp, that's the bond king talking about this. And I think it is possible.”at 52:04

Credit markets

• Matthew Piepenburg · VON GREYERZ AG

  Big-tech bonds trading well below par, signalling stress in once-safe tech credits.

  He points to bond prices for tech names once seen as safe. Apple, which he calls a great credit, has a bond nearly 50% below par. A Google bond is about 20% below par. He says Oracle and Paramount, once sacred cows, are offering bonds well below par, which shows the stress building in AI-linked credit. He calls these companies junk-like credits and says the credit risk is more widely hidden than the equity risk.

  “Hell, even Apple, which is a great credit, has a bond right now that's nearly 50% below par. Google has a bond right now that's 20% below par.”at 25:35

• Matthew Piepenburg · VON GREYERZ AG

  Investment-grade bonds now beat tech stocks on total return, pulling money out of equities into bonds.

  Large tech issuers like Google, Apple, SoftBank and Oracle have bonds trading well below par with fixed coupons. Those bonds offer better total return than the stock market right now, so money is moving out of tech stocks and into bonds. He says Apple's default risk is lower than Oracle's or Paramount's. He expects bonds to become overbought and then oversold, but he calls the rotation very real for now.

  “are trading well below par with fixed coupons, the total return on some of these bonds is far more attractive than what you can get in the stock market right now. And so what's ironic is a crashing or risky bond market is actually drawing money out of the stock market into the bond market.”at 34:19

• Matthew Piepenburg · VON GREYERZ AG

  Stock and bond markets signal the end of a credit cycle; a stock and default risk combo looms.

  He points to plateauing profits, capex spending and M&A valuations near record highs as signs the credit cycle is ending. Hyperscalers spend heavily on AI with no free cash flow left over. He says that investors who chase yield move into riskier bonds, and that eventually default risk and stock risk hit at the same time, which he calls the ultimate perfect storm. He says that is not happening yet.

  “And I think what we're seeing in the stock and bond markets right now is the end of a credit cycle. You're seeing plateauing profits like we've seen early in the year.”at 35:43

US Treasuries & yields

• Matthew Piepenburg · VON GREYERZ AG

  Bond yields have not peaked; they only fall if the Fed monetizes debt, debasing the currency.

  He says yields have not peaked. Yields are at decade highs across sovereigns and the G7, and the US, France and others carry a higher risk premium because faith in their IOUs has fallen as debt levels rise. Yields could only be pushed down through yield curve control or currency debasement, meaning central banks print money to support the bond market. Doing that, he says, costs the currency and fuels inflation and social unrest. He cites the Fed's QE and the 2011-era interventions as examples of this playbook.

  “No. Not at all. Unless there's... Unless you use yield curve control or debasement of the currency to monetize the bond market, which that could control yields.”at 14:47

• Matthew Piepenburg · VON GREYERZ AG

  Foreign buyers have retreated: China halved Treasury holdings and Japan sold to defend the yen.

  Japan and China used to be the biggest buyers of US debt, but they are no longer buyers. He says China has cut its Treasury holdings from over $1 trillion to about half that. Japan sold more Treasuries this year to support the yen than in the previous four to five years. He concludes the Treasury market is losing its main sources of demand, with yields around 4.6-5.2%.

  “when the biggest buyers of our debt was Japan and China, and they're just not buyers anymore. China, like I said, has gone from over $1,000,000,000,000 to half of that in US Treasury holdings. Japan sold more US treasuries this year to support their yen than they did in the last four to five years.”at 45:51

US dollar

• Matthew Piepenburg · VON GREYERZ AG

  The dollar has lost over 90% of purchasing power since 1971, and dedollarization is accelerating.

  He argues the dollar is being debased. Since 1971 it has lost more than 90% of its purchasing power in absolute terms and more than 99% against gold. He ties this to a shift away from the dollar. Central banks are stacking gold, now hold more gold than US Treasuries, and BRICS countries are moving away from the dollar. He also points to a weakening petrodollar and says the BIS has made gold a tier-one asset. He presents this as a debt crisis showing up in currency.

  “Since 1971, the US dollar has lost more than 90% purchasing power in absolute terms and more than 99% in its purchase power against gold.”at 20:12

• Matthew Piepenburg · VON GREYERZ AG

  The dollar faces repricing and less reserve dominance, moving toward a more multipolar world order.

  He says the debt problem cannot be solved by stablecoins, yield curve control, restructuring or gold revaluation. The outcome is a repricing of the dollar, less dollar hegemony, and a more modest America and economy. He thinks this leads to a more multipolar system with debased currencies globally. He argues that the dollar is distrusted and that the Treasury market has lost its buyers.

  “less dollar hegemony, less dollar and American hegemony in the world, a more multipolar system, a more modest America, a more modest economy”at 53:42

Gold & precious metals

• Matthew Piepenburg · VON GREYERZ AG

  Central banks are buying gold heavily, which he sees as smart money fleeing paper currency.

  He reads central bank gold buying as a sign that smart money is moving from paper currency into real money. Central bank gold holdings have risen about five times since the US weaponized the dollar in 2022. Central banks now hold more gold than US Treasuries, and the BIS has made gold a tier-one asset. He presents this as evidence of dedollarization and a debt crisis in progress.

  “Central bank gold stacking up five x since we weaponized the dollar. We see central banks holding more gold than US treasuries.”at 20:41

• Matthew Piepenburg · VON GREYERZ AG

  Gold beats inflation-adjusted yields; stocks and bonds are losing in gold terms despite nominal gains.

  He argues a 7% bond yield does not beat real inflation, which he puts closer to 10% than the official 3-4%. Measured in gold, even a 10% S&P return is negative. Over five years the Nikkei and S&P 100 rose 100-150% in dollars but fell 20-30% in gold terms. He says gold is outperforming the currency investors measure yields in, and that China is buying gold at record pace to make its currency more respected. He runs a gold business, so he has a commercial interest in this view.

  “So that means even a 7% paying bond, you're not beating inflation. You're not getting positive yields. And even if you're getting 10% on the S and P, measured in gold terms, you're down negative percentages.”at 39:06

AI infrastructure & data centers

• Matthew Piepenburg · VON GREYERZ AG

  Hyperscalers are overspending on technology that could get far cheaper from China.

  He argues the largest tech companies are overspending on AI infrastructure. He says this technology could get far cheaper from China. Google and Amazon are now cash-flow negative because of their data spending. If the hyperscalers are wrong that OpenAI or Anthropic will lift productivity to record levels, they could restructure their balance sheets and drag down the S&P, Dow and Nasdaq.

  “These hyperscalers, these top five mag seven type companies are overspending on unmoated technology that could get far cheaper out of China.”at 24:46

• Matthew Piepenburg · VON GREYERZ AG

  Hyperscaler AI capex is grossly overpriced and underperforming, consuming all their free cash flow.

  He cites hyperscaler capex of $380 billion last year and a figure he states as $7.8 trillion this year for AI (figure as spoken). He argues this spending is grossly overpriced and underperforming. Hyperscalers that always generated free cash flow now show none because it is all spent on AI data centers. He treats this as a sign of late-cycle excess in both stock and bond markets.

  “$380,000,000,000 last year, another $7,800,000,000,000 this year in AI, which is grossly overpriced and underperforming. And we see no free cash flow in these hyperscalers that once always had free cash flow. It's all spent on AI data centers.”at 36:06

Europe's economy

• Matthew Piepenburg · VON GREYERZ AG

  France is sleepwalking into a debt crisis of its own making; its fiscal position is unsustainable.

  He argues France is heading into a debt crisis it created itself. Debt is above 120% of GDP and the budget deficit is about 5%. GDP growth is 0% and likely to turn negative, so the government lacks the income to cover its costs. Spending cuts are politically unpopular, and Macron lacks a parliamentary majority, which makes a fix hard before the April election. The 10-year yield near 4.9% now exceeds Italy's and Greece's, and yields are at multi-decade highs even after a February budget briefly stabilised them. France faces about $77B of debt to service in 2026.

  “I think France, the rest of Europe and The US, is sleepwalking into a debt crisis of its own making, but it has $77,000,000,000 worth of debt to service in 2026.”at 7:58

European politics

• Matthew Piepenburg · VON GREYERZ AG

  Social unrest from inflation and debt will drive extreme centralization and capital controls.

  He argues that social unrest from inflation is inevitable and historically it is followed by extreme centralization from the left or right. He expects this to show up in Europe first and then in the US, through capital controls, restrictions and subtle centralization. He cites France's speed cameras as an early sign of a broke government tightening control. He presents this as a historical pattern repeating itself.

  “what often follows social unrest is extreme centralization from the left or the right.”at 13:17

AI bubble & tech valuations

• Matthew Piepenburg · VON GREYERZ AG

  AI stock valuations are terrifyingly overvalued; this is the worst capital misallocation in history.

  He argues AI stocks are badly overvalued and that the capital flowing into AI is the worst misallocation in capital markets history. He grounds this in the balance sheets and losses he reviews, and in his experience with IPO valuations. He says AI is absorbing most of the S&P and the debt market. He puts about a two-to-three-year window on whether the hyperscalers' productivity assumptions prove right, and expects companies like CoreWeave to become the rule rather than the exception if they do not.

  “my thesis... is that it is the worst misallocation of capital in the history of capital markets.”at 24:26

US stock market outlook

• Matthew Piepenburg · VON GREYERZ AG

  The S&P is dangerously concentrated in AI stocks; if AI disappoints, the index crashes.

  He argues the S&P is far too dependent on AI. AI stocks make up about 50% of the index, and hyperscalers generate 93% of its earnings. If the AI productivity bet fails, he expects the damage to spread beyond AI stocks and credit to the S&P, Dow and Nasdaq. Because American households hold about 48% of their wealth in stocks, he says the fallout would hit main street too.

  “It's uh-oh for the S and P because the S and P is 50% driven by AI stocks. 93% of its earnings come from the hyperscalers.”at 29:49

AI & jobs

• Matthew Piepenburg · VON GREYERZ AG

  AI won't deliver a productivity miracle; growth could stay under 1% over the next decade.

  He sides with an MIT view that AI will bring less than 1% growth over the next ten years. He says AI is a fantastic new technology and research assistant, but will not change productivity across the globe or in US markets. He says the hyperscaler CEOs' view of a productivity miracle and abundance conflicts with this, and that both cannot be right. He gives about two to three years to see who is right.

  “it really is maybe just a fantastic new tech and a fantastic research assistant, but it's not gonna change productivity across the globe and across The US markets.”at 29:49

Banks

• Matthew Piepenburg · VON GREYERZ AG

  Rising yields hit big banks like Goldman and BofA, since their bond collateral loses value.

  He says big banks such as Goldman Sachs and BofA have fallen sharply while the S&P hit highs, because they are highly sensitive to interest rate risk. Much of the collateral on bank balance sheets is bonds, so as yields rise, bond prices and that collateral fall and financials take the hit. He cites the 2023 banking crisis as the precedent for this mechanism.

  “A lot of the collateral on the balance sheet of these banks is bonds. And as yields go up, bond prices, their collateral go down, and the financials get hit.”at 33:52

US inflation

• Matthew Piepenburg · VON GREYERZ AG

  Official US inflation is understated; government deliberately runs negative real rates to inflate away debt.

  He says CPI and PPI prints are open fiction and that inflation tracks broad money supply and the rate of debt growth. He puts true inflation closer to 10% rather than 3-4%. Because debt-to-GDP is very high, he argues the US government needs inflation above its 10-year and 30-year yields, so it runs negative real rates on purpose. He cites global broad money reaching $150 trillion, up 50% in six years, as evidence of debasement.

  “The US government and The US ten year and The US thirty year are not beating inflation. They're running negative real rates. It's an intentional policy, and what the government does is it just lies about inflation.”at 40:16

US rates & the Fed

• Matthew Piepenburg · VON GREYERZ AG

  The Fed will likely buy time with yield curve control, Operation Twist and eventually QE.

  He expects the Fed and Treasury to buy time by using yield curve control and an Operation Twist 2.0 that issues more short-dated debt to ease long-end pressure. He notes Bessent already tried this without success. He also expects a gold-backed bond, gold revaluation and a Clarity Act stablecoin push. He says the Fed will likely end up with nothing but QE, but these tools only buy time.

  “I think they're gonna buy some time with more yield curve control, this Operation Twist two point o where they'll issue more from the short end to take pressure off the long end, that's what Bissent has tried and hasn't worked”at 50:49

Stablecoins & crypto policy

• Matthew Piepenburg · VON GREYERZ AG

  Stablecoins won't create enough demand for US Treasuries to rescue the bond market.

  Stablecoin issuers must hold T-bills, so proponents see them as a source of Treasury demand. He does not think global demand for a US dollar stablecoin will be large enough to bail out the Treasury market. He doubts the US is trusted enough for the world to buy its paper at that scale. He also dismisses the claim that the $150-plus trillion euro-dollar and derivatives markets will permanently create dollar demand.

  “is that the stablecoin market is not gonna create that much demand. The world doesn't want a e dollar and a volume enough to bail out the US treasury market. I don't think The US is that trusted or loved.”at 52:46