Debt has become the main character on Wall Street as markets decide it's now gotten out of control

The enormous mountain of debt hanging over the economy has overshadowed the AI boom as the center of attention on Wall Street.

For years—decades even—the spiraling trajectory of U.S. debt fueled dire warnings, which investors consistently brushed off as low borrowing costs helped turbocharge epic stock gains.

Meanwhile, the debt pile galloped higher, interest costs sucked up a bigger share of the federal budget, and deficits continued to expand. Rating agencies downgraded U.S. credit, and foreign central banks stopped buying as many Treasuries.

The precise tipping point was always unclear, especially as the U.S. dollar retained its status as the world’s top reserve currency. But the global bond selloff this past week that sent yields to the highest level in two decades showed debt is finally front and center as a concern.