The US is sliding toward a debt crisis as borrowing costs jump and the government's monthly deficit blows out — bad news for taxpayers, bondholders, and anyone holding dollar assets.

• The US just posted a record July deficit, spending more than double what it took in, with interest on the debt alone topping what it spends on defense or healthcare.
• Long-term government borrowing costs hit a 25-year high above 5%, a sign investors have lost faith the US can control its spending or inflation.
• Recent Treasury auctions are going poorly, forcing higher yields — which makes future borrowing even pricier and feeds a spiral with no clean exit.
• A massive AI and chip building spree in the US, Korea, and Japan is pushing companies and governments deep into debt, bidding up prices for metals, energy, and materials worldwide.
• The bigger danger is the yen: Japan's inflation is spiking, a rate hike looks likely, and that could unwind a huge global bet that funds US bonds with cheap Japanese money.

Outlook: Expect yields to stay high or climb as more corporate and government debt floods the market, with money-printing the only escape valve left — and that just means more inflation.