Key Points:
Crowd-Out Chain: Tech capex surge → Foreign buyer pullback → Treasury self-purchase of long bonds
Public Opposition: A March 2026 Gallup poll shows 71% of Americans oppose an AI data center built near their home, exceeding the peak opposition Gallup has ever recorded for local nuclear power plants.
Rate Ceiling Risk: If Treasury General Account draws continue funding the expanded buyback at the current pace, capacity is forecast to exhaust well before the 30-year yield stabilizes below 5%; the yield hit 5.3% last week, a near 20-year high.
Corporate Cash Burn: CoreWeave is guided to burn $23.8 billion in cash in 2026, while Amazon has committed $20 billion to two new Pennsylvania data centers, adding to hundreds of billions in aggregate AI financing demand hitting the bond market.
There's a farm field in Muncy, Pennsylvania. A tech firm wants to build a data center on it. The neighbors are fighting to stop them.
Muncy sits in Lycoming County. Farm country. Rolling hills. Small towns.
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I can't stop thinking about that field. Because what happens on it is why your mortgage refi came back at 6.72% last week.
Here's what worries me. The Treasury just started buying its own bonds. Scott Bessent is the Treasury Secretary. A few weeks ago, he doubled the buyback plan. And Treasury is now tapping its near $1 trillion cash pile to pay for it.
The story on TV is that this "supports the market." That sounds fine. It's also not the real story.
The real story is this. AI firms are borrowing so much cash that the U.S. government can't get a fair price on its own debt. The tech giants are out-bidding Uncle Sam in the bond market.
Mohamed El-Erian said it out loud on CNBC yesterday. He told the anchors that the demand for bond money is coming from "the government, by tech in particular." Meanwhile, the old buyers — China, Japan, the Gulf states — have all stepped back from Treasury auctions. So who's left to buy our government's debt? Fewer hands. And when fewer people want to buy, the seller has to pay more. That's how bond math works.
Look at the size of what tech is doing. CoreWeave, one AI firm, will burn through $23.8 billion in cash next year alone. Amazon just put $20 billion on the table for two data centers in Pennsylvania. Meta, Microsoft, Google — they're all doing the same thing. They all need bonds. They all need loans. And they're all writing bigger checks than the Treasury.
Bond markets don't have unlimited money. There's only so much cash sitting on the sidelines. When AI firms scoop up hundreds of billions of it, less is left for anyone else. Uncle Sam included.
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Here's what nobody's connecting. Americans hate these data centers. A Gallup poll from March found 71% of us don't want one built nearby. That's more than have ever said no to a local nuclear plant. Let that sink in. People would rather live next to a nuclear reactor than a server farm.
I get it. Data centers are loud. They eat power. They drink up local water. The construction jobs go away after year one. And the school district gets almost nothing back in tax help.
Last week, Gov. Josh Shapiro of Pennsylvania stripped Amazon's fast-track permits. He told the builders they now need town approval. He said they have to pay to hook up to the grid on their own dime. It was a quiet move. But it was a big one. And it's part of a wave.
Towns from Virginia to Ohio to Georgia are pulling the plug. Zoning boards say no. Neighbors show up in packed rooms. Signs go up in front yards.
So think about what's really going on. Tech firms are borrowing huge sums to build things Americans don't want. That borrowing crowds our government out of the bond market. The Treasury then has to buy its own bonds just to keep long-term rates from blowing up. And every rejected project means the tech firms go find another town, spend more, and borrow more.
Here we are. The 30-year Treasury hit 5.3% last week. Highest in almost 20 years. The 30-year mortgage sits at 6.72%. That's real money out of your pocket. On a $400,000 loan, I did the math. You're paying close to $800 more each month than you would have five years back. That's a car payment. Every month. For 30 years.
I don't think most people realize the loop we're stuck in. The Treasury buys its own bonds because AI firms out-bid it. But the AI firms borrow more each month because towns keep saying no. So they build in the next town over. And the next. Rates climb. Refi quotes get worse.
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Nobody knows how long this can hold. The Treasury only has so much cash on hand. Bessent can't buy bonds forever.
But here's what I keep coming back to. That farm field in Muncy. The neighbors don't want a data center. Their fight looks small. It's not. It's one thread in a much bigger story. A story that ends at your kitchen table with a refi quote you can't sign.
Our government is now a buyer of its own debt. Because a handful of AI firms out-bid it. And every homeowner in America pays the price. Every single month.
More on this tomorrow.
— American Ledger
