Aug 19, buyback doubled to $4B, yields dropped (30yr had its biggest one-day drop in 10 months). Today, tripled to $6B, a bigger intervention, yields rose immediately, with the 30yr punching through 5.3% right in the announcement window.
All while giving tax cuts and pushing to expand deficit spending that is only going to make the existing issues worse. Its like burning a candle from both ends.
the gop is running the country more like a Russia, the money moves does not make a lot sence for those of us on the outside. however, the small circle is making money hand over fist extracting what ever it can from those not in the circle.
they're also going to pass the bag like they always do--shit will really hit the fan in a year or two, a dem gov will be stuck cleaning up their mess, they'll campaign on how shit the economy is, idiots will buy it and vote for republicans again, rinse wash and repeat.
The more hardship republicans can cause for ppl the more likely they are to support authoritarianism. It’s happened over and over again throughout history.
nope, im voting Republican for the first time ever, they aint gonna pass the buck and blame others, let them explain this 8 year trend, republicans will never recover if we do this.
i'm sorry, i can't take anyone still bitching about democrats in our current political moment seriously. no side is perfect, one side is very obviously worse. also the 2008 crash definitely could have been handled better, but i don't think letting the global financial system dissolve would have been good for 'Main Street'.
We can say the Democrats are vastly preferable to Republicans and still criticize them and demand better from them.
Until they start improving the lives of ordinary people, our population will remain vulnerable to the next bizarrely charismatic demagogue. We are all in this together, Democrats are not immune from taking their share of responsibility for our country and for our people, and they are choosing not to do that even though they could choose differently.
Vote for Democrats and demand that they behave with character and morality, and when they don’t primary their asses until we have finally replaced them all with people who are moral and can begin moving forward years from now.
It is both possible and desirable to vote for Democrats and also demand better from them.
It's super fun watching our elected officials drive us off a fiscal cliff solely because they refuse to stand up to the President. Literal own goal after own goal after own goal.
The only way this stops is if the economy literally implodes and Republicans get destroyed in the next two elections.
Which is what it will take. The only way we were able to get even the relatively modest reforms Obama enacted was Republicans screwing things up so badly they got dog walked in two consecutive elections.
Don't hold your breath. I'm confident that trump could go on live tv tomorrow and say he's going to bankrupt the country because that's just how he feels today. And the democrats still wouldn't flip the senate at midterms and, come 2028, the brain dead US voters would still vote to give trump a third term, because that's just what their facebook comment section and russia backed influencers told them to do.
Is the Treasury financing the bond buy back with short term debt? I thought I heard mention of another "floating" fund but can't remember the specifics. Also, should the Treasury really be run by a guy whose last hedge fund lost 90% of its value? Just because he made one good bet in the 90s doesn't mean he can manage an economy the size of the US.
Yes, the Treasury cannot create money, only the Fed can. If the Fed buys bonds, it creates new money, if the Treasury buys bonds, it does so with money from short term debt.
Like paying off your fixed rate mortgage with variable rate credit card debt - increasing the rate at which the Treasury emits short term notes that have to be renewed every three months or less in an inflationary environment may lead to issues in the future if rates go up.
With short-term debt, they are creating money in a way. Money market funds buy the debt, and it gets added to M2. The holders of MMFs treat their holdings as cash.
The rollover risk is staggering. Even if the Fed steps in to function as a buyer, short term rate increase will have an enormous effect on the interest it pays on the reserves it creates with banks. Same thing happening in Japan on an even larger scale in % terms.
Not to mention that when the US cost of debt exceeds US GDP growth rates, sovereign interest rates (and all others) will skyrocket until the gov't restores fiscal responsibility.
Swapping long-term duration for short-term duration: (a) accelerates when r>g and (b) is likely a problem for the next administration.
Unless there's reason to think rates are going lower, Bessent is engaged in very myopic policy.
There are arguments for and against austerity. The argument against austerity is a supply side thesis that spending increase will expand GDP. This works so long as the increased GDP goes toward paying down debt thus making the strategy a bridge to an outcome. It worked in the Reagan years and ultimately led to a balanced budget, suprlus even in the Clinton years. Where it does not work is when we just spend decades going deeper and deeper in the hole.
The Greek situation was more like a bankruptcy in the sense that private bondholders took a massive write-down (around 50% I recall) and the debt was restructured in an environment that was low interest and low global inflation. Keep in mind the difference in scale. The US economy is about $30 trillion GDP to Greece's $280 million.
If the US went a similar route it would throw the entire world economy into crisis.
I mean if you truly give no shits, it's mostly fixed rate fixed term loans, so you could just print a shit ton of money until the debts worthless. Deliberate mass inflation.
I mean you'd destroy the dollar as the world's reserve currency and basically burn most of the US economy to the ground, but hey, at least you didn't raise taxes or cut Social Security.
Increase taxes, find other sources of revenue beyond taxes, cut spending, inflate the debt, outgrow the debt, default on the debt. Those are essentially the options. Most of those you can combine into a pot of some-of-this-some-of-that, except for one which you really shouldn't.
It's almost mechanical how this plays out in the end. Treasury has the job of funding the govt as cheaply as they can. So borrowing gets termed down to shorter term. Then interest on reserves goes back to required reserves, and real rates get suppressed. Financial repression then is in full swing. And it's not even necessarily the wrong thing to do, if the political situation can't solve the problem. It more progressive than austerity at least.
The ONLY possible move I can see is they really think that stablecoins will let them expand the money supply while selling short term bonds, so rates don't rise.
The GENIUS act legalizes stablecoins, as long as they are backed by U.S. dollars or short-term treasuries. They can then be used as ordinary payment coins for products or services.
This basically serves as an end-run around the Fed, by creating alternative pathways for the federal government to charter new entities that are allowed to issue currency. Treasury shifts long-term debt to short-term; they then charter a stablecoin company that is required to buy that debt; the stablecoin now issues their own currency which competes with USD in circulation and drives up prices. It's a way of monetizing the debt even when the Fed is uncooperative, by giving alternate corporate entities the ability to issue currency that is 1:1 exchangeable with U.S. dollars.
They're playing with fire, though, because if you are one of these stablecoin providers and a significant amount of commerce is flowing through your platform, it is a short leap to start charging your own taxes, building your own military, and establishing your own legal system, and then replace the government that authorized you.
You're still increasing money supply. Even if partitioned into different FX, increasing either or both currencies increases purchase potential and likewise inflationary pressure. Rates rise.
On the military, where would that military reside? US has laws about competing militaries operating on US soil without invitation.
Yes, you are increasing money supply. That is the point. But hiding it behind private issuers lets you lie about it while also keeping rates in check (the GP's point). Eventually lenders catch on that inflation is happening and raise the rates they demand to compensate, but it's obfuscated in a parallel economy, transacted in a currency that isn't tracked or reported, and so it may be several years before they realize what's going on. In the meantime, you can fuck them.
About the military - if it gets to that point, we are well past the point at which laws matter. You treat the U.S. government as a hostile combatant and hide what you're doing until you can destroy them. Extra points if you happen to control the U.S. government and can make them extra incompetent.
You weren’t aware that during Biden’s term lower income Americans had some of the best real wage growth in decades? That was very highly publicized economic news - you must not be aware of a lot.
Wages did jump up in 2020 (before Biden took power). They also continued to rise slower, but were soon overtaken by inflation for all but the lowest quintile, who barely saw a positive move.
https://fred.stlouisfed.org/series/les1252881600Q
This wasn't an accident - Biden made sure to split the move to raise the minimum wage from the things the Democrats actually wanted for their donors.
And while incomes for the lower income did rise sharply the first 2 years of Biden's presidency, this was almost exclusively due to the Child Tax Credit.
>They also continued to rise slower, but were soon overtaken by inflation for all but the lowest quintile, who barely saw a positive move.
Convenient how your historical account seems to end in 2022 and ignores the last two years of real wage growth under Biden. It takes a little bit of time to recover from an economic catastrophe, ok? Nevertheless, what you did choose to acknowledge is literally a reduction in income inequality. Lowest quintile did better than any other. How are you not understanding that? 🤦♂️
>This wasn't an accident - Biden made sure to split the move to raise the minimum wage from the things the Democrats actually wanted for their donors.
Manchin and Sinema didn’t support it. Keep pretending democrats are a conspiratorial monolith. Not to mention it would have been ill-advised to raise the minimum wage during an active wage-price inflationary spiral.
Regardless, it’s a red herring because well under 1% of all employees earn the federal minimum wage. That’s a whopping 82,000 people in 2024 according to the BLS. Compare that to 13% in 1979. Many states and cities have implemented higher minimums. It’s not the path to shared prosperity - it’s just become some kind of brainless fixation for some people.
>And while incomes for the lower income did rise sharply the first 2 years of Biden's presidency, this was almost exclusively due to the Child Tax Credit.
So you acknowledge a specific policy of Biden’s reduced income inequality and your prior statement was bullshit. Great, thanks. Now add on to that the fact that the real median wage in your link above was higher in Q4 2024 than any point pre-Covid, and you’re starting to have a halfway decent understanding. Now tell me, are those 2024 data points almost exclusively due to the Child Tax Credit, or did republicans take over Congress by then and you’re just making up another bullshit statement?
> Convenient how your historical account seems to end in 2022
Uh no? The FRED data above is through 2025. And shows that your claim that real median wages were highest in 2024 is also nonsense. Both 2020 and Q2 2025 onward are higher. Can you not read or something?
> Manchin and Sinema didn’t support it.
And both were Democrats. Your point being what?
> Keep pretending democrats are a conspiratorial monolith
Oh, I don't think that at all. Democrats are varied - but the problem is that the centrists you're defending are far to the right of their base. And that's exactly the problem. Because they're the party leadership.
So why are you defending them? Do you like Manchin and Sinema?
> Regardless, it’s a red herring
No, it's not. Because the minimum wage increasing forces other wages to rise as well to continue to differentiate.
But it's odd you put the blame for this on Manchin and Sinema, considering you're claiming it's a good thing it wasn't passed either.
> or did republicans take over Congress by then
The Child Tax Credit expired while the Democrats still held both houses, in 2022.
Maybe time for you to brush up on that economic news you're babbling about?
Dude you’re a joke, or you’re trolling or something. You cut up my post into a few random phrases and completely ignored the part where I proved that Biden helped improve income inequality. So your initial comment was either a lie or ignorant. Either way, please stop spreading misinformation.
And then even in the parts you cut up and included and responded to, you have horrible reading comprehension and tons of inaccurate statements. I’m not wasting my time addressing all that.
Maybe cuz Biden was busy dealing with the global economic shock that was covid.
Trump was handed a functioning economy and then single-handedly trashed it with tarrif policies from the 19th century, a pointless war in a key economic part of the world, and ... perhaps the biggest wtf?? ... a trade war with Canada.
The problem is exactly that Biden (and Harris) held policies so similar to his.
Pretending we wouldn't be seeing many of the same problems under Harris is silly, since she was to the right of even Biden on economic matters.
The one argument is she probably wouldn't have been stupid enough to launch the Iran War - though given some of her statements, and her non-stop support of Israel even when it was known it could lose her the election, even that's not a sure thing.
A huge problem in this country is "both siders" that think there is no material difference between the Republican cult that lives in a fantasy vs. the sane but imperfect Democratic politicians.
This country has always had sane but imperfect politicians, and we've managed to thrive. We will not survive if the authoritarian cult that is MAGA gains any more power.
> vs. the sane but imperfect Democratic politicians.
Who keep losing to the GOP, and locking in their policies when they're elected and do nothing.
Your support of them is what enables them to continue to enable the GOP. Every vote for Biden in 2020 was making sure there would be a Trump victory in 2024. Called it at the time, and unfortunately was proven correct.
they started a war with Iran? Implimneted mass tariffs? threatened allies? sucked up to russia? cut aid to Ukraine? paid out billions to cut energy projects?
he kept them because constantly changing tariffs is horrible for the economy and he had to stick a soft landing from the shit show that was turnips first term. (and I'll never fix that autocorrect)
And no, turnip didn't "make sure the guns to Ukraine contined to flow", even your own link says so:
"For Ukraine, the bill scales back U.S. involvement by limiting assistance largely to military support. Economic stabilization and civilian reconstruction aid are curtailed. Annual assistance for Ukraine is set at $400 million, a substantial reduction from the multi-billion-dollar aid packages approved in 2024 and 2025." (emphasis theirs)
and yes, cutting energy projects make "private company profits skyrocket" with massive cancelation fees (paid by taxpayers), and increased the cost of electricity prices for everyone, bang up job.
Again, you want to pretend that somehow Biden was substantially different. He wasn't. He (or, let's face it, his advisors, as pudding brain wasn't doing much deciding) was better on some things. But the main thrust of driving up the debt, squandering the US international position, and being fully committed to war and empire while the rich continue to loot the US was never even slowed down, much less reversed.
Waiting for what? If youre waiting for america and the right ti learn their lesson you'll be waiting a while. They'll just blame everything on the next democratic president and keep voting republican. Fox News and social media wont blame Trump and thats where their thinking stops.
All of that could happen and then they’d trot out their library of tired lines such as We inherited a mess, this is Joe Biden’s economy, short term pain for long term gain, things will be on the upswing in a couple of quarters…
Some people want to watch the world burn. TBH, I have a hard time not supporting this viewpoint these days considering how fucked the American plebeians already are.
The world economy is extremely interconnected, especially the western block. I don’t know where you live but if we crash and burn, the dominoes will fall almost everywhere.
As a Canadian, I've got my popcorn kettle working overtime watching the downfall of the USA.
We're bailing on your sinking ship and will enjoy watching your country collapse. Sure, we'll suffer a bit as a result, but we're happily finding alternatives and partners who are reliable, honest, and actually looking for ethical and mutually beneficial partnerships.
What's the feeling in Canada toward annexing the U.S. west coast, New England, and the upper Great Lakes, basically recreating the Jesusland map?
Many of those states share politics that are pretty close to Canada, it's contiguous, and it would create three countries in North America that are roughly equal in population (the United States of Canada would have about 200M people; Jesusland would have about 170M; Mexico would have about 135M).
There used to be more of an appetite for an amalgamation of some US states with Canada. The appetite for that seems to have mostly faded. Most of the Canadian appreciation for US cultural similarities has disappeared alongside the lack of political action to resist the federal government and shitbag-in-chief's affronts to Canada and global stability more broadly.
There are no outspoken movements from the more liberal states to distance themselves from the USA, or its politics. From a Canadian perspective, it appears as the opposite of that, where US citizens only seem willing to speak up for their self-interest.
I really hope the sell off is a more strategic thing meant to tank Republicans in the midterms so Dems can reign this bullshit in because if not...yeah we're cooked.
There are ways to protect your assets. You have AI. I’m so sick of this “we’re cooked” GenZ defeatist bullshit as if oil shocks and bond yields rising have never happened. Spend some time and learn something.
Soros was the boss, but Bessent was the guy in London to do it under Soros. Sources are mixed on who actually gets the credit for the trade but either way, Bessent was involved. Now he's the guy who has to defend the dollar or let it collapse under the debt burden.
i believe by now about 3% of the population considers him a clear and present danger. Half those people are sane and will never commit a crime over it, the other half...him being trump of course not this lackey
He is buying low and selling high. He's buying long-term bonds because they are priced low, and selling short-term bonds because they are priced high (relatively).
Right now the yield curve has bull-steepened and Bessent is exercising the OBVIOUS arbitrage opportunity therein.
"the fed" is not doing this, the treasury is. And his job is not to set spending, treasury just has to scramble to best figure out how to do it. It's not a great position to be in. But Bessent isn't the guy who can do anything about it.
yes but at best this is just goofy. short term notes have to be rolled over or paid off, all it's doing is kicking the can down the road.
it's either a bad idea or a minor win.
Oh man I just found out how goofy this is, funny I used that word (in desperation against your certain attack). From Politico
>Guy LeBas, chief fixed income strategist at Janney Montgomery Scott, noted that Treasury also issued $39 billion in new 10-year securities on the same day, optics that he referred to as “a little goofy.”
They are effectively shortening maturity by buying back long term obligations with short term money in an effort to reduce interest expense and hold down yields. The effect will be lower interest cost because short term rates rates are lower than long term rates.
But there's no free lunch and the trade off here is called rollover risk when it come times to refinance the shorter term money. If rates rise, the debt service cost could escalate quite dramatically.
The Fed could step in and act as a buyer, but in a rising rate environment, there are consequences because the way the Fed "creates" money is by creating bank reserves against which they must pay interest at a short term rate called IORB. Today that rate is 3.65%. If short term rates rise, this interest on reserves adds a layer of interest cost to the government on top of what it pays on the bonds. If short term rates are held low, it could cause inflation to run away.
By illustration, in prior periods where the Fed was practicing loose monetary policy, it was creating reserves in a zero or near zero rate environment which is very different than today.
Honestly, the only healthy answer is deficit reduction which means increased revenue (taxes) and/or reduced spending (austerity). Or war.
This is also an inflation game. Bessent is trying to pull the inflation forward by exchanging long term bonds for short.
But without any plan to reduce principal, this is basically an adjustable rate mortgage that we keep adding to. Because inflation compounds, shifting the inflation from the last years of the "mortgage" to the first years results in way more interest over the whole term.
What the bond market sees is that we're going to increase near term inflation but not do anything to reduce future interest expense. Even if we get over the inflation hump in a few years, on a 30 year timeline, we're still experiencing much more inflation than if it happened at the 20 year mark.
> If short term rates rise, this interest on reserves adds a layer of interest cost to the government on top of what it pays on the bonds.
Maybe I am misunderstanding your point here, but that is not how the Fed's accounting works. If the Fed buys the bonds, the Treasury pays the bond coupon directly to the Fed. The Fed then pays the IORB to commercial banks out of its own asset earnings, not as a taxpayer expense. Any net profit left over is transferred back to the Treasury via weekly remittances. The government isn't paying another layer of interest, the original bond interest is refunded back to the fiscal budget. In this scenario the floating IORB rate is the only net cost.
Somewhat sarcastic, but in broad historical terms, there is a pattern of dominant military powers securing economic dominance and exploiting the other countries they have subordinated. The United States did it very effectively after WWII. The British, Dutch and even the Romans did the same. The establishment of the world's financial system being built around the U.S. dollar as reserve currency created what the French call the exhorbitant privilege of the U.S. That one post-war spoil is a large contributor to growth in U.S. wealth.
A healthy, cooperative global community discourages the possibility of economically motivated conflict, but that's not what we have right now. I realize we're off the main topic of debt management right now, but suffice to say, the Treasury can only get so far manipulating maturity, we have to either cut spending or raise revenue at some point. Other than the tax base, another way of raising revenue is siphoning wealth from someone else, which is where military action enters the equation.
>Other than the tax base, another way of raising revenue is siphoning wealth from someone else, which is where military action enters the equation.
That's what I was assuming. Just seems like that "business model" may not work well in the current era unless it's to emulate China and Russia's neo colonialism.
I can't say for sure, but it is well known that Ukraine was the bread basket economic crown jewel of the former Soviet Union, which is all the incentive Putin ought to have needed to streamroll in and try and annex it.
Maybe a country or two sitting on a lot of oil would be a likely target. Venezuela and Iran come to mind. Greenland's natural resources are estimated in the trillions. Who knows?
Yeah, we have that already and supply munitions to many countries. That avenue is tapped unless you mean war crimes like pillaging oil and we're already doing that too to Venezuela
Did bonds yeids initially drop because they were being repurchase before their maturation date? If so, why did it do the opposite when the US gov decided to buy back more?
I’ll try to explain in the most simple terms the way I understand why yields dropped initially then increased with the new announcement:
Our baseline is going to be supply and demand. When supply of something goes down, assuming all else stays equal, including demand, the price of that will go up. And when supply increases, prices go down.
With bonds, yields have inverse relationship to the price. As price goes up, yields go down, and vice versa. The basic mechanics of this is simply that if you pay more for something your ROI (yield) goes down. The interest is fixed on the bond, but you’re paying more to get it.
The standard operation has been up to $2b buyback per week since the program was launched in 2024. In August when it was announced this would increase to $4b, this was somewhat of a surprise. Suddenly there could be more long term bonds being taken off the market (decrease in supply). So the prices increased, lowering yields.
But with this surprise, the market also tries to price in what they expect in the future. There was some speculation that buybacks could increase further. So when this new announcement came just a month later, it had already been priced in. Although the market seems to have somewhat overshot that price prior to this latest announcement, so it’s now just correcting by decreasing the price, increasing long term bond yields.
What they’re doing is the rough equivalent of paying down your mortgage with your credit cards. The most generous interpretation is that it’s a cynical ploy to keep mortgage rates from going up higher before the midterm elections.
Indeed! You probably saw where he was quoted “I am the house” which became an instant meme of the Tom Hanks scene with the Somali pirate “I am the captain”.
The buyback reeks of desperation and doesn't do anything to inspire trust in the USA's ability or willingness to be good partners. Without changing their fundamental approach at the macro level (more responsible taxation, better trade agreements, and the removal of excessive tariffs), this admin will continue to crash the dollar.
And the best part is that Republicans will see the weakness of the dollar as wages stagnate and inflation climbs, and they'll keep asking themselves why Kamala would ever do this to them. Poor Trump, so helpless and feeble...thoughts and prayers.
I think people misread that one. The peak was in pre market on the 18th. The public announcement was in pre market on the 19th. Who is to say a heads up didn't go out over that 24 hour period?
I think the connections Bessent has to the people who short Fx is significant and I won't be surprised if unofficial communication isn't happening daily.
As for today, it seems more like a retest of that peak yield. If it breaks 5.335% then it really matters. Otherwise I would see this as an excellent buying opportunity. I won't be surprised if we are back down to 5.25% or lower tomorrow. If we get the long bond to 5.2% by the end of the month that could make this a meaningful peak.
The real issue is that while people are watching this the cost of capital for the broader economy is going up and a bunch of selling is happening in equities.
Jokes aside you might be onto something. But regardless it is also fair to say that if this was the treasury department trying to fix the bond markets its impact has been pretty muted so far.
Investors in these markets know that the underlying issues remain unaddressed and anything Bessent does at this point is a band aid at best. This is not a long term solution
The yields only went down for less than 24 hours. Wednesday the announcement was made, and by Thursday the yields were back up at 5.25% on the 30yr.
Very soon, the market will not even flinch at these buybacks because investors will see the USA as a sinking ship, and even with higher and higher interest rates, they will be skeptical to buy. The reason: investors do not have faith in the "full faith and backing of the United States" anymore.
The Fed's independence is being threatened, and even with raising it's interest rates, investors will be concerned and avoid investing the more hostile and desperate the USA becomes.
The Iran war is costing $1bln/day, so is the buyback using $6bln really that much by comparison, in terms of how much it can influence markets? It'll pay for less than a week of the war.
The bond market is like the honey badger: "it just doesn't give a fuck." And since we either have 0 economic policy or insane economic policy from the WH... the bond markets are gonna be the adult in the room.
This move reeks of Desperation, as the markets already know that both BOJ and US Treasury are playing whack a mole, in their desperate attempt to forestall the inevitable yield rise. Trump's utter lack of fiscal plan is the core reason that the markets are disregarding buybacks.
The current 10yr yield agrees with my statement 🤦🏼🌮🤷🏼🤣
I wouldn’t say it reeks of desperation. The US government debt grows by $7B per trading day, not including re-issuance. A $6B purchase doesn’t even cover a day of treasury issuance.
The federal reserve has unlimited discretion to enact monetary policy. They bought $100’s of billions of debt per week during the pandemic crash, provided over $1T in overnight repos, etc. They have the ammo to affect rates.
A token $6B buyback shows that Bessent doesn’t actually want to interfere with the debt market beyond giving Trump a headline, which is why debt markets reacted negatively. This is all bark and no bite.
Average gas is $4.22 nationwide right now. I can personally say that my gas station went from $4.00 to $4.40 this week so it seems possible that gas will hit $5 this year as the SPR runs down, canadian gas stops coming to the Us, russia, and ME gas keeps being blown up unless something major changes. I would bet that unless trump stops saber rattling, canada will temporarily restrict gas to the US in october to make midterms hurt republicans
This plus tariffs will lead to inflation increasing, interest rates having to go up to try to stop it. Bond market is dumping. Anyone on an adjustable rate mortgage is probably gonna lose their home.
Then Jan 1 a bunch of people are going to lose their healthcare because of trump’s bbb.
Ive also noticed around me rurally that I think if people have another car to drive they're driving it. Definitely seeing less of these big stupid trucks lately.
Yeah but highway trucks and farm tractors also run on diesel and yes I know most of those guys also voted trump but hear me out.
So now those guys feel it in the pocket right away but that’s going to get directly passed on to consumers and inflation is going to skyrocket. Problem is the economy is dependent upon diesel to transport basically every good and service we need and it’s not just trucks and tractors but trains and ships too.
Yup and tons of multi generational farmers are going to have to sell when they can’t find enough demand for their produce. Huge corporations will buy up that land for pennies on the dollar and the food prices will be jacked up even more. This is a direct result of the incompetence most farmers voted for. It’s our job to make sure they see the connection and feel the consequences so that they can accept and change their views. There’s a half dozen plus different bubbles on the verge of popping. We’ve managed to skate on by for the past couple of years while they’ve gotten bigger, but we won’t be able to do that indefinitely. I only hope that we elect someone who can put strong regulations on markets and companies to ease the blow on the average consumer and spread the risk back onto the wealthiest in the economy. I doubt the country could withstand another bailout like in 08. We simply don’t have the means to do it without causing a depression if multiple bubbles pop near the same time.
We have a bunch of these diesel queens around here. I also laugh every time I hear one of the blast down the highway with their detuned POS on rubber band rims sticking out. Like wow, that sounded expensive lol
If only conservatives could figure out who is to blame for the economic hardship. They will be screaming about Biden through the end of Trump's presidency.
You must remember that Trump inherited this very poor economy. He's ONLY has two years to fix it. Tariffs and war will definitely fix it just give it time!
Yeah, we're so beyond fucked day to day the Trump years have basically doomed our climate change response and thus the outlook for humanity in general. Instead of some measured progress, which would still certainly not be enough to fully prepare but better than doing nothing, we've done worse than nothing and actively regressed on sustainable energy.
Next president maybe gets 8 years to dig us out of this hole, probably not a ton of time to focus on combatting climate change given all the other disasters Trump is causing, before the pendulum swings back to the next fascist to drive us fully into oblivion. 2037, it'll be here before you know it, get to head into my 50s living in a full on climate crisis.
And that's the optimistic version where there is a next Democratic president in 2029 and not just even more extreme descent into fascism and cancelled/fraudulent elections.
If our elections are untampered and we elect a Democratic president and all they do is focus on climbing out of this hole we find ourselves I am sure that president will be rewarded by losing the 2nd term.
Ironically, this will all eventually act as a carbon tax that no one had the political will to enforce (good thing). As someone who spent a lot of time and money creating a home that is net carbon negative, I am pretty pleased with myself.
Buy your ebike now folks! The world is about to change.
It’s not that bad. We’re already doing much better than initial “current state” projections that were around +3-4 degrees Celsius of warming. Now we’re looking at +1.5-2.
And that’s with no help from these worthless conmen known as republicans and the most delusional old fuck ever as President. Even Ron Desantis admitted to climate change in the primary, he just lied that the free market would fix it.
Every day green energy gets cheaper and better and some stupid old boomer has their house wrecked by horrible weather. I’d love to see a clean planet and we have a long way to go, but I’m more optimistic than I’ve ever been.
Yeah, a lot of the people who will be losing healthcare are a lot of the same folks who are more vulnerable to health risks posed by extreme heat events.
It doesn't matter if they believe them or not. They'll support Republicans no matter what due to tribalism just being human nature. If Republicans win or steal the midterms, then they'll just come up with some other reason why voting Republican is good. It's a huge flaw in human nature and why propaganda is basically the ultimate weapon and so effective. Russians are dying every day while still thinking that Putin is great. People literally kill their own kids in cults.
That’s actually brilliant, Canada shuts down all US oil exports ahead of the midterms. Short term pain for Canada, huge kick in the nuts for Trumpistan. I have popcorn on standby
Yeah the only way Canadian exports fall is if Iran blows up Keystone or something similarly improbable. If the feds restrict Alberta’s ability to export it will give a huge boon to Alberta separatists movement.
We’ll see what’s left of that “movement” after Oct 19. It’s already on life support with a ringleader on the hook for $100miion and the prov not releasing the viability study they commissioned.
Ah I’m a pessimist now when it comes to this stuff working out. To many billionaires and foreign governments pumping us full of garbage on the internet and TV to their own ends.
florida is 4.20 and indiana is 4.50 ish. as of yesterday, 5 is not out of the question. old enough to remember 2008, economy was alwful and gas was super high.
From what I understand the Chinese government is starting to buy oil again. That was really what was suppressing prices so heavily is that China basically just stepped out of the market using their reserves.
I live in one of the 5 states with the lowest gas prices. We're at about $3.75-$3.80 right now. For comparison, I found it in the nearest metro for $1.99 in December 2025. I fear I shan't ever see that number again.
People always looked at me crazy when I said "People have no idea of the fate they've chosen." I don't even get the satisfaction of "I told you so" because being right about this shit is not a win for me, it's a loss for everyone.
Well at least republicans in congress will declare some emergency measures to make sure the billionaires can profit from all these economic calamities.
You know… This is by far the most corrupt government ever to have exist in the United States of America, and they are simply trying to speed run bankruptcy for the entire nation and under 2 1/2 years it’s truly miraculous
I’ve been saying this for a long time. COVID showed just how beneficial a crashing economy is for those with the money to buy everything cheap. COVID isn’t going to happen again, so we have to force people into needing to dump assets cheap in other ways.
The thing people really don't get when they say Trump is compromised by Russia is that that isn't true at all; he's not compromised, he wants to be the Putin of the USA.
Right down to mimicking the fall of the USSR, where the oligarchs were able to steal everything that wasn't nailed down.
The idea that Putin pulls the stings on everything is insane. People have agency themselves and blaming some outside actor for everything removes any sort of idea that people in this country can have their own awful motivations.
They got too good at controlling crashes honestly. Under the pretext of protecting the economy, they developed a bunch of tools that ensure the rich get richer in a crash and the bulk of the cost of the crash is passed on to regular people in sneaky ways like shrinkflation, rent prices and etc. The regular people get mad at these changes but have a hard time pinning down the actual cause. The politicians then insert causes into public thought that are beneficial to the rich and much of the public falls for it.
In Ohio some are saying if Vivek Ramaswami wins all sorts of state-owned assets will be turned over to the private school industry/maybe religious nuts to keep them in line
It was also written in their project 25 plan. So like it's not just anyone's feelings. This was deliberate and written down and given to people to see before they voted.
Wealth accumulation at this insane level is a mental illness. Totally worth risking collapsing economies and devastating peoples lives so you can get some more brownie points among fellow rich.
Anyone actually paying attention during COVID with all the property being bought off the courthouse steps by equity groups and the private wealthy should have figured out where this was likely to go. At this stage the "you will own nothing and like it" is their motto. They want anyone south of a multiple of billions of dollars to be bankrupt so they can finish what COVID started. The death of the US.
Begs the question: why? Bankruptcy protection doesn't exist for countries and creditors, and by destroying the US economy, they will destroy a number of other countries' economies when their considerable investments in our economy become insolvent.
We're at the brink of where the USSR was in August/September 1991.
Circular financing, like paying off one credit card with another with higher interest rates. America’s financial power has largely been based on the confidence of its stability, now we have some delusional asshole in the White House with an equally unqualified not-serious administration
>Market reaction, however, was negative. Treasury yields rose further but were volatile with long-dated securities rising as much as 5 basis points each before easing.
Nothing to see here. Bessent totally knows what he is doing and markets have taken notice. Carry on as usual!
Former Soy Bean man, Scott Bessent, is a staunch professional. A genius really. He’s the best people, totally fierce. Trump only brings in the most smart, fierce genius people. That’s why we’re all doing so great you know. Truly a golden age! /s (so much sarcasm.)
This is like paying your mortgage with your credit card. We are essentially swapping long term debt with short term debt.
Watch the activity around the 10-year. Everything is based on that and THAT is the canary in the coal mine.
> We are essentially swapping long term debt with short term debt.
Yes, but have you considered that Trump and his accomplices don't expect to be the ones who will have to deal with the fallout when the whole thing comes crashing down.
Well he did say that he's the house and the house can never lose !!!!!
If the FED doesn't hike in September, poor long terms bonds and the trust of the American economy.
Long term bond trends are showing a deterioration of trust in various western economies. Maybe a couple of decades of cheap money isn't the best way to go. Let the economy go boom and burst to avoid huge pile of debt.
I fancy myself as somewhat of an auditory lie detector. I have a knack for it. Bessent had no confidence in what he was saying. He knows he's bluffing and terrified the bluff will be called.
I thought Bessent was the House now?? This seems counterintuitive. Words words words words words words words words words words words words words words words words.
They could just cut tariffs, make trade peace, sue for peace with Iran, and just reduce import costs, but nah, let’s just try to prop up treasuries and fight the massive bond market instead. Clown show.
I always get the feeling that these guys are intentionally destroying the world around them. They see some future where their insane ill-gotten wealth protects them while everything burns. But this smarmy fuck takes the cake. The smirk on his face is infuriating. Where is the fucking karma???
Hello oil silo, here's one quart of oil for you!(The normal level of purchases each day is a trillion dollars.)
One must remember that the Fed does things to affect bond yields and attractiveness. This is the US Treasury instead pretending to act like Papa.
Our tax-revenue deficit should increase to fake propping this monstrosity upwards? We are spending debt to pretend people want to buy more of our debt.
The response not long after from the market was to be more fearful and tight-walleted.
I'm writing this so I don't get fined.I'm writing this so I don't get fined.I'm writing this so I don't get fined.I'm writing this so I don't get fined.I'm writing this so I don't get fined.I'm writing this so I don't get fined.
Just a reminder, neither the Fed nor The Treasury sets bond yields. Those are determined by the free market, and the free market is telling us that our does not like this.
"Once markets believe Treasury is defending a price, every rise in yields becomes a test of official resolve, and the operations must grow to survive the tests.” - Stan Druckenmiller
Bessent is going to get smoked if he keeps doing this. Buy gold.
Totally cool and normal thing for a totally fiscally sound government to do to it's completely, totally, absolutely trust on us this stable bond market.
I still absolutely love(hate) how people are ok with companies and governments buying back their debts... Somebody fucking put 2 and 2 together please for the love of fucking god.
There's nothing wrong with buying back your own debt in principle. It's essentially paying back creditors early at the current market rate. The creditors have a choice to set their own price to accept an early repayment, or wait until maturity.
It's kind of a big part of the point of bonds. Why would you even hate it? Who is supposed to be the loser when a company repays a creditor at a price the creditor accepts?
The current debt swap is just stupid though, but that's mainly an issue for the US government and their constituents.
Unlike Hank Paulson’s bazooka, Bessent’s itty-bitty bazooka looks broke, wimpish and smells of desperation. Markets are not buying this. 10-yr and 30-yr treasury yields are up since Bessent unveiled his latest bitty bazooka.
Man o' man, do I sleep well at night, knowing I'm Canadian and our leader knows exactly how all this shit works. Somehow we have half the US debt per capita, a higher credit rating AND lower interest rates!
Ahh yes, using one credit card to pay off another...sound financial plan...I cant see what might go wrong here. /s
I wonder when America wakes to to the fact that these clowns dont have thier best interests in mind. Speed running the demise of the USA, socially, politically and economically...Wake up America and do something!
Isn’t the end game of this like, the demand placed on the government to sell bonds will keep increasing (to service the interest), and potentially the demand for those bonds will drop, making rates even higher? I don’t see how much longer they can be low for?
This feels almost more like corporate finance than macroeconomics.
A business can restructure its liabilities and make its balance sheet look better at the margins. Eventually, though, the market still asks the same question: why did investors demand a higher return from you in the first place?
I hope people are recording every single transaction, every rate change, the debt and deficit figures every day under the current administration. Because you know when Democrats get back into power the debt is suddenly going to matter again...
We hit 40 trillion in debt, less than a month ago. We’re now 115 more billion in the hole as of sept 9th…. That’s 115 billion spent in what, 30 days? I CANT AFFORD FOOD OR GAS!!! I WORK TWO JOBS, AND THIS FUCKING COUNTRY IS IN A SHIT HOLE. FUCK THIS GOVERNMENT AND FUCK DONALD TRUMP.
Sorry, this is the kleptocracy playbook. When the USSR collapsed, oligarchs quickly gobbled things up during the fire sale. Every Republican president since Reagan had their own little fire sale after a deregulation crash. Trump is pulling a full Hoover with his tariffs and isolationism, hopeful that he remains the master of the bankruptcy bounce. His ‘friends’ are content to play along that everything is fine for Americans because it’s gauche to cheer on an arsonist while you wait for the fire sale, but the fire sale is what they’re counting on for acquiring tangible assets offset their gamble on the AI bubble.
The crooks have to rob somebody and that somebody is us
Exactly. JD Vance having a stake in AcreTrader while the US President consistently makes moves to undermine American farmers and push them to bankruptcy is the most nakedly obvious corruption, and it's just another line on the list.
The AI bubble isn't about AI; the government is openly fast tracking data centers with a significant number of GPU's. As AI advances, it will require newer, faster, more complex and more capable GPU's, and that's just 2-3 years away.
The government is pushing for data centers because the government needs GPU compute to use digital currencies as the new reserve currency when the US dollar tanks. They need significant GPU compute for Tether and stablecoins to act as collateral backing the US Dollar. With the GENIUS Act under Trump or the CHIPS Act under Biden, the goal is clear: devalue the US dollar, announce stablecoin integration, watch as the US dollar climbs in value (if it does).
Its been clear to me that these Republican bastards have wanted to collapse our government into something resembling the Kremlin kleptocracy in every detail for a long time.
By "small government" they are being quite literal. Small as in a King, some vassal tech-lords, and then the rest of us.
I’ve never understood the “doomer” argument. Pointing out objective fiscal and monetary facts along with analyzing how the US Congress spends money isn’t being a fucking “doomer.” It’s objective reality. Many people just aren’t capable of lateral thinking if they think pointing out the flashing, warning signs is just some sort of hobby.
The facts are that news, middle, center, and left overstate and overhype minor issues to the point that it is difficult to tell what is actually an emergency or truly ominous.
I am sick of reading articles at face value and getting schooled on the facts which show that x, y, or z that I was worried about because of the article is actually not much changed since 1950 or something like that... it happens all the time.
Think headlines like, home price growth decreased 80% since last month. Like wtf, thanks for finding any way you can to get a big percentage in the headline. It actually just meant that prices increased 1% two months ago and 0.2% last month LOL
Fair. I can see how anyone who isn't well-versed in the dark magics of statistics and percentages might feel like a leaf in a hurricane with all the "articles" that spew forth relentlessly from modern media. I'd advise trying to learn at least the basics of statistical misrepresentation, and ideally also spend quite a bit of effort learning causal logic and methods of critical thinking.
Anyone for whom that requires too much time/effort might be better off disregarding any and all articles containing "%", "per", "average", or any statistics-sounding word in the title. Being ignorant is better than being actively wrong, as uncomfortable as that idea might feel.
Hypernormalisation was prevalent in the USSR in the 1970's and 1980's, right up until the dissolution of the USSR.
>everyone in the Soviet Union knew the system was failing, but no one could imagine any alternative to the status quo, and politicians and citizens alike were resigned to maintaining the pretense of a functioning society.
1970's and 1980's saw the USSR take on considerable debt to Western banks. Chernobyl was a major disaster that estimates say cost $2 trillion, which further pushed the USSR into financial crisis. Gorbechov and glasnost (transparency) added pressure (whereas the USSR was all about closed doors and trust, glasnost attempted to replace it with transparency), which resulted in the soviet states declaring independence in early 1990/1991.
Now, in America, the 2010's saw considerable growth in big tech, creating a bubble around the future of technology, media consumption, citizen information access, communication, etc. It broke a LOT of the old systems, and now we're seeing the pullback in revenue generation as the companies are bloated amalgamations of smaller companies (Alphabet is Google with other companies; Meta is Facebook and Instagram and others, etc).
Meanwhile, national debt continued to explode, largely pushed into place under Republican leadership (George W Bush, Trump) with modest attempts at budget repair and deficit decreases under Democratic leaders (Obama, Biden). COVID in 2020 added $8 trillion to the national debt, and now we're facing $40 trillion in debt (compared to the US's $24 trillion GDP).
Trump's Administration, like glasnost, is using unprecedented levels of confusion, obstruction, redaction and endless lies to insert opacity to a government previous defined by it's transparency. Add to that a global market that's less and less willing to count on America's ability in (or interest in) paying what it owes, and you have the recipe for USA collapse similar to the USSR.
Hypernormalisation is ending; the world is calling bullshit on the lies Americans and American government have told about themselves for years, and the numbers don't lie. $40 trillion in debt can not be paid back by $24 trillion in GDP, and the current reticence of big tech, American government, and all the companies that were and still are overinflated but losing value daily.
Normally, it's a punditry back-and-forth match where people can make good points and it becomes "We'll see what they do...".
I hope you like which state everyone lives in right now, because by end of 2027, it may be a foreign country to your friends and family in other ~~states~~ countries.
Americans allowed this. Americans voted for it with a bullshit broken voting system that awards the Presidency to the popular vote loser twice in the last 26 years (George W Bush in 2020, and Trump in 2016). Americans did not take to the streets, depose their government, demand change through revolution; so now we all get to suffer the embarrassment of losing our federal government because Americans were convinced that we're the best, we're the smartest, and anything we do is the "right thing."
Your entire post culminates in a "if we elected democrats everything will be okay" which totally excuses the failings of the democratic party to offer a political program that working class people can get behind. Not excusing the insanity of the republican party here, but the democrats are just as invested in maintaining the corporate political system we have because it rewards their consultancy regime which act as liaisons between the party and the corporate world. Would they have done the insane tariffs or initiated the iran war? probably not, but they certainly wouldn't fix any structural issues with inequality in any meaningful way.
>"if we elected democrats everything will be okay"
I mentioned Democrats once in my whole reply, and it was the fact that Democrats (Biden and Obama) made tiny reductions in deficit while further pushing the debt-growth policies that further reinforced our national debt.
You're delusional and unserious, I said nothing of the sort about Democrats. You were just desperately sniffing for a "but both sides!" bullshit.
> they certainly wouldn't fix any structural issues with inequality in any meaningful way.
This looks and sounds like a debt death spiral; something a desperate debtor would do to put off the day of reckoning. Is it really any different than check kiting?
Buying with what? Printing money? That is inflationary that will increase the cost of doing business and the cost of servicing that 40 Trillion plus debt. Im not an economist, but an ordinary observer, and even I know it is a knee jerk reaction to a fundamentally flawed system.
Scott Bessent is doing this and fiscal necromancy in Japan, the US has a war in Iran, and you guys still think the Fed is going to hike rates as opposed to assisting the US Treasury as much as possible?
Well, maybe or maybe not. Warsh has his back his back to the wall. Whatever he does now will hurt something, somewhere, because that is the state of the system. 25 years of financial insanity is going to have a hard landing now whether they want it or not.
The Fed can do whatever the fuck it wants, but yields are going up, because the bond market smells blood in the water and there's nothing Warsh can do about that.
The alternative was not to start a war with fucking Iran of all powers, and we are WELL past that. Instead of the Fed combating inflation in a calmer macro environment, ie Diesel not skyrocketing, the Fed will basically exercise their discretion and remain “data dependent” meaning nothing will be done. Tightening into Bessent’s nonsense just doesn’t make a single ounce of sense for Warsh.
Warsh should be hiking every single meeting, but how does that help the US Treasury?
They've created a financial paradox there is no escape from now. The debt is too large and we can't just fix 50 years of bad policy and fiscal insanity in a week. Doing what is good for the Treasury is bad for the Fed, and doing what is good for the Fed screws the Treasury.
$40 Trillion is about to land on their faces and start wiggling.
Can't US and Japan just change sides? Japan raise their rates to more than the US. And US drops to near zero as per Trumps request. The new carry trade is selling dollars (also boosts Trumps cheaper manufacture dream) to buy yen. The cycle continues just the players have swapped position.
With printed money! Maybe the Trump administration needs to balance the budget like he said he would do. At least stop spending money on a illegal war.
So, someone ELI5: I am well versed in economics but not in the bond market. If I understand correctly, buying back $6 billion in long term bonds should increase yields because there is less debt on the market, right?
But I don't think I'm understanding this. I don't see how buying back debt is a strategy for...what?
Also, what effect does the bond market have on the general economy?
buying a bond is a loan to the govt which you make back with interest. when people aren’t willing to buy bonds, in this case the US government, they have to raise the rate of interest to entice buyers. meanwhile, the govt pays interest on their accumulated debt, and it’s gotten so bad that they are doing anything to make some cash i.e. sell more bonds by offering higher bond yield rates.
if you see the 10 yr government bond return climb higher, it means the government has a harder time convincing buyers it is a sound investment.
OK. Thanks for this. My follow up question is the general effect of this on the economy. I'm not sure I see what the impact would be on the macroeconomy.
If the long term bond yields rise, it's not necessarily going to affect business or consumer borrowing costs. The worst impact I see is a larger percentage of GDP going to pay off debt. Today's action of buying back $6 billion in debt should have freed up some credit for the US and send bond yields lower, no? Are we saying that, even repaying $6 billion in debt immediately is not making US credit look any better to the bond market? Then the market is seeing risks outside of just the "balance sheet"?
The economic fundamentals say one thing but the political risk says something else and the political risk in the long term has to do with more than money. So, the bold yields are up because they don't see the US as such a safe investment in the long term. Is this correct?
OK...I think I talked myself through it. Thanks for your help.
the mortgage interest rate is correlated to the bond rate so it does affect borrowing. for example, why would a bank give you a 3% mortgage when they can get a 4% return from a govt bond?
The US government overspends its federal budget every year and the make the difference up by selling bonds to China, Japan, Canada, etc. And when their balance sheets are already loaded up on US treasury bonds, then they aren’t looking to buy more hence why bond rates can continue to rise.
the effect on the economy is we’re forced to cut back on federal spending which would kill the economy because the US government is the largest employer, or default on the debt which tbh I don’t even know what happens then… we allow countries to take assets as collateral? not to mention all this is happening in an inflationary environment
Honest question about this- where is the money coming from to buy back the debt? Don’t they just have to borrow more money to buy back those bonds? Who would be fooled by that shell game?
So the money is coming from the treasury general fund. It’s the treasury’s checking account basically. Taxes in. Expenses out.
This replacing of bonds close to maturity is actually fairly normal. Bonds close to maturity are hard to trade. And you want a liquid bond market. So yeah the treasury has been doing this for a bit. It’s not exactly paying the mortgage with a credit card.
What’s new is the scale at which this treasury is doing it. Long term yields are spiking because of our propensity to borrow into oblivion and this buying is pretty clearly an attempt at price manipulation
So they anticipate interest rates to be higher for longer? Otherwise, they'd buy shorter term bills. I wouldn't be surprised inflation remains a problem for the next 10 years.
I see we've reached the "kiting checks and using one credit card to pay off another" stage of the con.
It'll be very hard for Trump to be removed from office because the barrier is so high in the US system but he's gunning to become the American Liz Truss.
needs a few more zeros for this to have any meaningful effect, 600 billion would be a start. 6 trillion might be whats needed.
Words Words Words Words Words Words Words Words Words Words Words Words Words Words Words Words Wor Words Words Words ds Words Words Words Words Words Words Words Words Words WordsWords Wor ds WordsWords Words Words Words Words Words
Noob question. Why have we seen all these economic depression level articles and doom and gloom in the comments but things keep trucking along just fine?
Liberation dau tariffs, oil crisis from the war, circular trading/AI bubble, now this. Is this just another nothing burger that seems like a big deal but nothing will actually come of it?
Bring on the damn crash already if there is to be one. I’m sick of hearing about the sky falling for the thousandth time since fall of 2024.
[OP] Mr60SPX | 18 hours ago
Worth pointing out the market's reaction.
Aug 19, buyback doubled to $4B, yields dropped (30yr had its biggest one-day drop in 10 months). Today, tripled to $6B, a bigger intervention, yields rose immediately, with the 30yr punching through 5.3% right in the announcement window.
boblaplante | 17 hours ago
When you back the fed into a dove corner the market notices apparently
da_mess | 17 hours ago
The market notices when you deficit spend 50% more than annual revenue and your debt grows from 7x annual revenue to 8x.
iAwesome3 | 17 hours ago
All while giving tax cuts and pushing to expand deficit spending that is only going to make the existing issues worse. Its like burning a candle from both ends.
SeaEmployee787 | 16 hours ago
the gop is running the country more like a Russia, the money moves does not make a lot sence for those of us on the outside. however, the small circle is making money hand over fist extracting what ever it can from those not in the circle.
7Betafish | 16 hours ago
they're also going to pass the bag like they always do--shit will really hit the fan in a year or two, a dem gov will be stuck cleaning up their mess, they'll campaign on how shit the economy is, idiots will buy it and vote for republicans again, rinse wash and repeat.
CASUALxCHICKEN | 14 hours ago
It's been at least a 35 yr trend
joyfulcartographer | 11 hours ago
Longer. Raegan started it.
Ninevehenian | 14 hours ago
There's not going to be a lot of repeating that shit. There won't be an economy left to fuck around with.
getwhirleddotcom | 14 hours ago
It’ll never happen but I wonder if the Dems just sat out for 4 years and let them deal with the fall out. Break that cycle or cleaning up their shit.
Particular_Music_270 | 11 hours ago
The more hardship republicans can cause for ppl the more likely they are to support authoritarianism. It’s happened over and over again throughout history.
evantom34 | 14 hours ago
That wouldn’t change anything I’m afraid.
Competitive-Hair7499 | 14 hours ago
This is hardly an event that can be described as cyclical.
TheTav3n | 15 hours ago
ya it will be a democratic majority that has to cut entitlements and tax cuts hardcore. The irony.
StockCasinoMember | 14 hours ago
So maybe they shouldn’t raise taxes on the middle class and below. Tax the top.
The bottom 50% account for 14% of all income earned.
The bottom(majority) 75% only account for about 33% of all income earned.
The top .3% make 22% and the top 10% make 50% of all income.
AlsoInteresting | 12 hours ago
"50% of all income."
You mean their part of the shares on the stock market?
HowdyDiarrhea | 12 hours ago
This is going to sound insane, but yes
StockCasinoMember | 9 hours ago
This is “realized income”, not unrealized gains.
Meaning the top 10% have 50% of all realized income per year. Includes wages, cashed out stocks, and every other dime they make in a year.
The unrealized gains in stocks or other assets are not included in that number.
Xeynon | 5 hours ago
I don't think it's going to take a year or two at this rate.
AEternal1 | 14 hours ago
nope, im voting Republican for the first time ever, they aint gonna pass the buck and blame others, let them explain this 8 year trend, republicans will never recover if we do this.
Maxpowr9 | 16 hours ago
And the Democrats will gladly bail out Wall Street leaving Main Street to suffer; which is why they will just as quickly be voted out.
battlepi | 15 hours ago
But will they rape our children?
Competitive-Hair7499 | 14 hours ago
A rapist will be provided to take care of your children upon deployment.
7Betafish | 16 hours ago
i'm sorry, i can't take anyone still bitching about democrats in our current political moment seriously. no side is perfect, one side is very obviously worse. also the 2008 crash definitely could have been handled better, but i don't think letting the global financial system dissolve would have been good for 'Main Street'.
JefeRex | 14 hours ago
We can say the Democrats are vastly preferable to Republicans and still criticize them and demand better from them.
Until they start improving the lives of ordinary people, our population will remain vulnerable to the next bizarrely charismatic demagogue. We are all in this together, Democrats are not immune from taking their share of responsibility for our country and for our people, and they are choosing not to do that even though they could choose differently.
Vote for Democrats and demand that they behave with character and morality, and when they don’t primary their asses until we have finally replaced them all with people who are moral and can begin moving forward years from now.
It is both possible and desirable to vote for Democrats and also demand better from them.
coalescence2071 | 15 hours ago
Oligarchic capitalism… stealing what they can, as fast as they can.
genxluddite | 14 hours ago
And then blame the cuts on services on the next party to get in. Typical right wing procedure.
Busterlimes | 10 hours ago
No kidding, dont we basically have a government owned oil company in Venezuela right now?
3dogs2nuts | 10 hours ago
the insider trading works on both sides of the isle
GOP’ers aren’t the only ones making $$
OptionConcoction | 13 hours ago
Pulling capital from the markets has its own set of issues.
No_Effective4784 | 6 hours ago
shame we have been scooping wax out of the middle to feed the flames as well..
rooftopgoblin | 6 hours ago
its like burning a nuclear bomb candle at both ends. When this thing crashes its gonna be ugly
TurnstyledJunkpiled | 16 hours ago
Apparently that’s how “the party of fiscal responsibility” behaves.
Elf_Maeve | 11 hours ago
Damn I think we need more tax cuts and loopholes. It's the only way to balance the budget.
Hasn't worked the past 26 years Republicans tried but... next one will do it. I can feel it.
da_mess | 8 hours ago
Respectfully, both parties do it. Biden deficit spent 40% of tax revenue.
Clinton was the last to run a balanced budget. He benefited from an strong economy driven by the internet boom.
If AI went away, the US economy would be stagnant.
Can you imagine the potential with a fiscally responsible admin?
Knerd5 | 15 hours ago
It's super fun watching our elected officials drive us off a fiscal cliff solely because they refuse to stand up to the President. Literal own goal after own goal after own goal.
The only way this stops is if the economy literally implodes and Republicans get destroyed in the next two elections.
Xeynon | 5 hours ago
Which is what it will take. The only way we were able to get even the relatively modest reforms Obama enacted was Republicans screwing things up so badly they got dog walked in two consecutive elections.
Goodk4t | 4 hours ago
Don't hold your breath. I'm confident that trump could go on live tv tomorrow and say he's going to bankrupt the country because that's just how he feels today. And the democrats still wouldn't flip the senate at midterms and, come 2028, the brain dead US voters would still vote to give trump a third term, because that's just what their facebook comment section and russia backed influencers told them to do.
chasingjulian | 17 hours ago
Is the Treasury financing the bond buy back with short term debt? I thought I heard mention of another "floating" fund but can't remember the specifics. Also, should the Treasury really be run by a guy whose last hedge fund lost 90% of its value? Just because he made one good bet in the 90s doesn't mean he can manage an economy the size of the US.
CrayonUpMyNose | 17 hours ago
Yes, the Treasury cannot create money, only the Fed can. If the Fed buys bonds, it creates new money, if the Treasury buys bonds, it does so with money from short term debt.
ItsMetheDeepState | 15 hours ago
Like paying off a credit card debt, with another credit card?
huangsede69 | 14 hours ago
Not just with another credit card, but with one that makes the rates on your previous credit card go even higher.
CrayonUpMyNose | 13 hours ago
Like paying off your fixed rate mortgage with variable rate credit card debt - increasing the rate at which the Treasury emits short term notes that have to be renewed every three months or less in an inflationary environment may lead to issues in the future if rates go up.
Whiskey_Bear | 12 hours ago
Like paying off the credit card with a payday loan.
3_Thumbs_Up | 11 hours ago
More like paying of your mortgage with your credit card.
vinyl1earthlink | 10 hours ago
With short-term debt, they are creating money in a way. Money market funds buy the debt, and it gets added to M2. The holders of MMFs treat their holdings as cash.
da_mess | 17 hours ago
> Is the Treasury financing the bond buy back with short term debt?
That's what they've been doing. Replacing long term bonds with 6 month money is a gamble that short term rates don't rise.
With the 2yr ~50bps over fed funds, we're likely seeing two rate increases in the next 6 months.
Ask_Individual | 17 hours ago
The rollover risk is staggering. Even if the Fed steps in to function as a buyer, short term rate increase will have an enormous effect on the interest it pays on the reserves it creates with banks. Same thing happening in Japan on an even larger scale in % terms.
da_mess | 17 hours ago
Not to mention that when the US cost of debt exceeds US GDP growth rates, sovereign interest rates (and all others) will skyrocket until the gov't restores fiscal responsibility.
Swapping long-term duration for short-term duration: (a) accelerates when r>g and (b) is likely a problem for the next administration.
Unless there's reason to think rates are going lower, Bessent is engaged in very myopic policy.
King-Meister | 16 hours ago
Very apt username.
Also, is there any way out other than austerity? The only way out seems to be the Greece way.
da_mess | 16 hours ago
GDP growth could rise.
Inflation could soar (this would raise costs, including for labor, which would increase tax revenue). Trouble with this is rates would also increase.
Gov't could spend within its budget and gradually reduce debt.
As for my user name, it represents me and no country (though i do see the similarities). 🙂
Ask_Individual | 16 hours ago
There are arguments for and against austerity. The argument against austerity is a supply side thesis that spending increase will expand GDP. This works so long as the increased GDP goes toward paying down debt thus making the strategy a bridge to an outcome. It worked in the Reagan years and ultimately led to a balanced budget, suprlus even in the Clinton years. Where it does not work is when we just spend decades going deeper and deeper in the hole.
The Greek situation was more like a bankruptcy in the sense that private bondholders took a massive write-down (around 50% I recall) and the debt was restructured in an environment that was low interest and low global inflation. Keep in mind the difference in scale. The US economy is about $30 trillion GDP to Greece's $280 million.
If the US went a similar route it would throw the entire world economy into crisis.
GTS250 | 16 hours ago
Higher taxes, pay down the debt quicker?
namafire | 16 hours ago
Higher tax rates need to be selective or otherwise slow down economic growth and activity, which could ironically lower net taxes
ReturnOfFrank | 15 hours ago
I mean if you truly give no shits, it's mostly fixed rate fixed term loans, so you could just print a shit ton of money until the debts worthless. Deliberate mass inflation.
I mean you'd destroy the dollar as the world's reserve currency and basically burn most of the US economy to the ground, but hey, at least you didn't raise taxes or cut Social Security.
gimpwiz | 5 hours ago
Increase taxes, find other sources of revenue beyond taxes, cut spending, inflate the debt, outgrow the debt, default on the debt. Those are essentially the options. Most of those you can combine into a pot of some-of-this-some-of-that, except for one which you really shouldn't.
seridos | 14 hours ago
It's almost mechanical how this plays out in the end. Treasury has the job of funding the govt as cheaply as they can. So borrowing gets termed down to shorter term. Then interest on reserves goes back to required reserves, and real rates get suppressed. Financial repression then is in full swing. And it's not even necessarily the wrong thing to do, if the political situation can't solve the problem. It more progressive than austerity at least.
a_library_socialist | 17 hours ago
The ONLY possible move I can see is they really think that stablecoins will let them expand the money supply while selling short term bonds, so rates don't rise.
It's basically stealth money printing.
da_mess | 16 hours ago
I may be missing something. How would stablecoin keep rates low?
Selling bonds increases rates.
Expanding M2 (money supply) also increases rates (via higher inflation).
All of the above would increase demand for usd (reducing US exports).
Stablecoin would be tied to the USD (ie value would rise). Selling this later increases M2 also increasing inflation/rates.
Countries can control their rates or currency, not both.
nostrademons | 15 hours ago
The GENIUS act legalizes stablecoins, as long as they are backed by U.S. dollars or short-term treasuries. They can then be used as ordinary payment coins for products or services.
This basically serves as an end-run around the Fed, by creating alternative pathways for the federal government to charter new entities that are allowed to issue currency. Treasury shifts long-term debt to short-term; they then charter a stablecoin company that is required to buy that debt; the stablecoin now issues their own currency which competes with USD in circulation and drives up prices. It's a way of monetizing the debt even when the Fed is uncooperative, by giving alternate corporate entities the ability to issue currency that is 1:1 exchangeable with U.S. dollars.
They're playing with fire, though, because if you are one of these stablecoin providers and a significant amount of commerce is flowing through your platform, it is a short leap to start charging your own taxes, building your own military, and establishing your own legal system, and then replace the government that authorized you.
da_mess | 8 hours ago
You're still increasing money supply. Even if partitioned into different FX, increasing either or both currencies increases purchase potential and likewise inflationary pressure. Rates rise.
On the military, where would that military reside? US has laws about competing militaries operating on US soil without invitation.
nostrademons | 7 hours ago
Yes, you are increasing money supply. That is the point. But hiding it behind private issuers lets you lie about it while also keeping rates in check (the GP's point). Eventually lenders catch on that inflation is happening and raise the rates they demand to compensate, but it's obfuscated in a parallel economy, transacted in a currency that isn't tracked or reported, and so it may be several years before they realize what's going on. In the meantime, you can fuck them.
About the military - if it gets to that point, we are well past the point at which laws matter. You treat the U.S. government as a hostile combatant and hide what you're doing until you can destroy them. Extra points if you happen to control the U.S. government and can make them extra incompetent.
Denver-Ski | 17 hours ago
We’re cooked
jessewalker2 | 17 hours ago
Please pull from the oven when internally temperature reaches 165 degrees
crustyrobots | 17 hours ago
We don't have a department that cares about that anymore, so room temperature meat is fine now
I_Love_To_Poop420 | 17 hours ago
Trunk temperature bear meat is exactly the delicious protein required for a hard swim in a toxic river.
PloddingClot | 16 hours ago
That is a very well crafted statement.
Mikestopheles | 16 hours ago
Yeah, but you have to read it in RFK's voice
Hopeful_Corner1333 | 16 hours ago
Ok. Just give me three hours and a carton and I got this.
crustyrobots | 15 hours ago
I think you also have to find some road kill and eat it to truly replicate his rasp
dust4ngel | 16 hours ago
RFK Jr recommends spraying cooked chicken with a mist of salmonella for immunity hardening.
martin | 17 hours ago
unless you're... chicken!
wait - or maybe if you are.
dust4ngel | 16 hours ago
dark helmet: what's the matter, colonel sanders? CHICKEN?
martin | 16 hours ago
I would have also accepted Biff/Griff Tannen: What's wrong, McFly? Chicken?
alanthar | 10 hours ago
Make like a tree and get the hell outta here!
martin | 9 hours ago
such a good bit
jeezfrk | 17 hours ago
Very very white meat.
Grey_spacegoo | 16 hours ago
Is that C or F?
fallwind | 17 hours ago
"buT SHe LaUGHed FuNNY!!"
/s
a_library_socialist | 17 hours ago
I wasn't aware that the Biden administration cut debt or dealt with income inequality. So not sure how this is relevant.
Scrandon | 16 hours ago
You weren’t aware that during Biden’s term lower income Americans had some of the best real wage growth in decades? That was very highly publicized economic news - you must not be aware of a lot.
a_library_socialist | 16 hours ago
Except this isn't true.
Wages did jump up in 2020 (before Biden took power). They also continued to rise slower, but were soon overtaken by inflation for all but the lowest quintile, who barely saw a positive move.
https://fred.stlouisfed.org/series/les1252881600Q
This wasn't an accident - Biden made sure to split the move to raise the minimum wage from the things the Democrats actually wanted for their donors.
And while incomes for the lower income did rise sharply the first 2 years of Biden's presidency, this was almost exclusively due to the Child Tax Credit.
Which the Democrats let die.
Scrandon | 11 hours ago
>They also continued to rise slower, but were soon overtaken by inflation for all but the lowest quintile, who barely saw a positive move.
Convenient how your historical account seems to end in 2022 and ignores the last two years of real wage growth under Biden. It takes a little bit of time to recover from an economic catastrophe, ok? Nevertheless, what you did choose to acknowledge is literally a reduction in income inequality. Lowest quintile did better than any other. How are you not understanding that? 🤦♂️
>This wasn't an accident - Biden made sure to split the move to raise the minimum wage from the things the Democrats actually wanted for their donors.
Manchin and Sinema didn’t support it. Keep pretending democrats are a conspiratorial monolith. Not to mention it would have been ill-advised to raise the minimum wage during an active wage-price inflationary spiral.
Regardless, it’s a red herring because well under 1% of all employees earn the federal minimum wage. That’s a whopping 82,000 people in 2024 according to the BLS. Compare that to 13% in 1979. Many states and cities have implemented higher minimums. It’s not the path to shared prosperity - it’s just become some kind of brainless fixation for some people.
>And while incomes for the lower income did rise sharply the first 2 years of Biden's presidency, this was almost exclusively due to the Child Tax Credit.
So you acknowledge a specific policy of Biden’s reduced income inequality and your prior statement was bullshit. Great, thanks. Now add on to that the fact that the real median wage in your link above was higher in Q4 2024 than any point pre-Covid, and you’re starting to have a halfway decent understanding. Now tell me, are those 2024 data points almost exclusively due to the Child Tax Credit, or did republicans take over Congress by then and you’re just making up another bullshit statement?
a_library_socialist | 11 hours ago
> Convenient how your historical account seems to end in 2022
Uh no? The FRED data above is through 2025. And shows that your claim that real median wages were highest in 2024 is also nonsense. Both 2020 and Q2 2025 onward are higher. Can you not read or something?
> Manchin and Sinema didn’t support it.
And both were Democrats. Your point being what?
> Keep pretending democrats are a conspiratorial monolith
Oh, I don't think that at all. Democrats are varied - but the problem is that the centrists you're defending are far to the right of their base. And that's exactly the problem. Because they're the party leadership.
So why are you defending them? Do you like Manchin and Sinema?
> Regardless, it’s a red herring
No, it's not. Because the minimum wage increasing forces other wages to rise as well to continue to differentiate.
But it's odd you put the blame for this on Manchin and Sinema, considering you're claiming it's a good thing it wasn't passed either.
> or did republicans take over Congress by then
The Child Tax Credit expired while the Democrats still held both houses, in 2022.
Maybe time for you to brush up on that economic news you're babbling about?
Scrandon | 4 hours ago
Dude you’re a joke, or you’re trolling or something. You cut up my post into a few random phrases and completely ignored the part where I proved that Biden helped improve income inequality. So your initial comment was either a lie or ignorant. Either way, please stop spreading misinformation.
And then even in the parts you cut up and included and responded to, you have horrible reading comprehension and tons of inaccurate statements. I’m not wasting my time addressing all that.
Own-Chemist2228 | 16 hours ago
Maybe cuz Biden was busy dealing with the global economic shock that was covid.
Trump was handed a functioning economy and then single-handedly trashed it with tarrif policies from the 19th century, a pointless war in a key economic part of the world, and ... perhaps the biggest wtf?? ... a trade war with Canada.
And that's just a small part of the list.
a_library_socialist | 16 hours ago
Trump is an idiot.
The problem is exactly that Biden (and Harris) held policies so similar to his.
Pretending we wouldn't be seeing many of the same problems under Harris is silly, since she was to the right of even Biden on economic matters.
The one argument is she probably wouldn't have been stupid enough to launch the Iran War - though given some of her statements, and her non-stop support of Israel even when it was known it could lose her the election, even that's not a sure thing.
https://breakingdefense.com/2024/10/americas-greatest-adversary-kamala-harris-says-iran-is-an-obvious-answer/
Own-Chemist2228 | 15 hours ago
>The problem is exactly that Biden
That's not the problem at all.
A huge problem in this country is "both siders" that think there is no material difference between the Republican cult that lives in a fantasy vs. the sane but imperfect Democratic politicians.
This country has always had sane but imperfect politicians, and we've managed to thrive. We will not survive if the authoritarian cult that is MAGA gains any more power.
a_library_socialist | 15 hours ago
> vs. the sane but imperfect Democratic politicians.
Who keep losing to the GOP, and locking in their policies when they're elected and do nothing.
Your support of them is what enables them to continue to enable the GOP. Every vote for Biden in 2020 was making sure there would be a Trump victory in 2024. Called it at the time, and unfortunately was proven correct.
Own-Chemist2228 | 15 hours ago
Sound logic.
And who did you vote for in 2020?
a_library_socialist | 15 hours ago
Bernie.
fallwind | 15 hours ago
"so similar to his"
they started a war with Iran? Implimneted mass tariffs? threatened allies? sucked up to russia? cut aid to Ukraine? paid out billions to cut energy projects?
a_library_socialist | 15 hours ago
Did you miss the article above regarding Iran?
Biden kept plenty of Trump's tariffs from Trump I.
> sucked up to russia
How exactly has Trump done this? He's continued to arm Ukraine, and is as willing as Biden to keep Ukrainian conscripts bleeding Russia.
https://www.thedefensenews.com/Trump-Ends-US-Foreign-Aid-in-2026-Budget-Impact-on-Ukraine-and-Israel/
While Trump killed plenty of foreign aid, he made sure the guns to both Ukraine and Israel continue to flow.
> paid out billions to cut energy projects?
Which were almost all private-public partnerships, and had the main effect of making private company profits skyrocket.
The Green New Deal, meanwhile, was torpedoed by exactly the centrist Dems you're trying to defend here.
fallwind | 13 hours ago
he kept them because constantly changing tariffs is horrible for the economy and he had to stick a soft landing from the shit show that was turnips first term. (and I'll never fix that autocorrect)
And no, turnip didn't "make sure the guns to Ukraine contined to flow", even your own link says so:
"For Ukraine, the bill scales back U.S. involvement by limiting assistance largely to military support. Economic stabilization and civilian reconstruction aid are curtailed. Annual assistance for Ukraine is set at $400 million, a substantial reduction from the multi-billion-dollar aid packages approved in 2024 and 2025." (emphasis theirs)
and yes, cutting energy projects make "private company profits skyrocket" with massive cancelation fees (paid by taxpayers), and increased the cost of electricity prices for everyone, bang up job.
a_library_socialist | 13 hours ago
Nobody's defending Trump here?
Again, you want to pretend that somehow Biden was substantially different. He wasn't. He (or, let's face it, his advisors, as pudding brain wasn't doing much deciding) was better on some things. But the main thrust of driving up the debt, squandering the US international position, and being fully committed to war and empire while the rich continue to loot the US was never even slowed down, much less reversed.
AlbertoRossonero | 16 hours ago
She was a shit candidate too is the problem
silvertealio | 16 hours ago
The shittiest candidate possible won the election, so try another excuse.
1234nameuser | 16 hours ago
Apparently not nearly shitty / stupid enough for Americans to elect based on who won
Unique-Egg-461 | 16 hours ago
So lets vote for the guy who outwardly said he'd tank the economy
Kemizon | 16 hours ago
Worse than Frump?
dcormier | 16 hours ago
In what way(s)?
HavingNotAttained | 17 hours ago
Parboiled, like a frog unawares
42ElectricSundaes | 13 hours ago
We nothing. I’m getting the hell outta here
Gods_ShadowMTG | 17 hours ago
good, let's go i am waiting
Antique_Limit_5083 | 17 hours ago
Waiting for what? If youre waiting for america and the right ti learn their lesson you'll be waiting a while. They'll just blame everything on the next democratic president and keep voting republican. Fox News and social media wont blame Trump and thats where their thinking stops.
Gods_ShadowMTG | 17 hours ago
waiting for it all to come crashing down of course.
The_Frostweaver | 17 hours ago
That would mean high inflation and no jobs
I would get a certain satisfaction from seeing Trump and his cabinet humbled but not at the expense of hurting so many.
Not like this.
CrackingToastGromet | 16 hours ago
All of that could happen and then they’d trot out their library of tired lines such as We inherited a mess, this is Joe Biden’s economy, short term pain for long term gain, things will be on the upswing in a couple of quarters…
Gods_ShadowMTG | 17 hours ago
I do though.
xanadumuse | 17 hours ago
Are you 12 years old ?
ScottyBoneman | 17 hours ago
Or from one of many many countries you've recently attacked or threatened.
xanadumuse | 15 hours ago
Americans are not a monolith.
Xuri88 | 17 hours ago
Ah yeah, you’re right. It’s probably best that we keep helping all the morons avoid suffering until we all cook to death from their idiotic decisions.
Sometimes pain is necessary.
Consistent_Room7344 | 17 hours ago
Some people want to watch the world burn. TBH, I have a hard time not supporting this viewpoint these days considering how fucked the American plebeians already are.
xanadumuse | 15 hours ago
I mean I get that but they continue to do that to themselves- there are others like myself who prefer not to suffer and sit in my own shit.
ABahRunt | 17 hours ago
Same.
Helps than I'm not American. It'll hurt me quite a bit when you'll crash, but I'll be validated for never wanting to emigrate
Droggles | 16 hours ago
The world economy is extremely interconnected, especially the western block. I don’t know where you live but if we crash and burn, the dominoes will fall almost everywhere.
User299651 | 16 hours ago
Based
DamionSipher | 16 hours ago
As a Canadian, I've got my popcorn kettle working overtime watching the downfall of the USA.
We're bailing on your sinking ship and will enjoy watching your country collapse. Sure, we'll suffer a bit as a result, but we're happily finding alternatives and partners who are reliable, honest, and actually looking for ethical and mutually beneficial partnerships.
nostrademons | 15 hours ago
What's the feeling in Canada toward annexing the U.S. west coast, New England, and the upper Great Lakes, basically recreating the Jesusland map?
Many of those states share politics that are pretty close to Canada, it's contiguous, and it would create three countries in North America that are roughly equal in population (the United States of Canada would have about 200M people; Jesusland would have about 170M; Mexico would have about 135M).
DamionSipher | 15 hours ago
There used to be more of an appetite for an amalgamation of some US states with Canada. The appetite for that seems to have mostly faded. Most of the Canadian appreciation for US cultural similarities has disappeared alongside the lack of political action to resist the federal government and shitbag-in-chief's affronts to Canada and global stability more broadly.
There are no outspoken movements from the more liberal states to distance themselves from the USA, or its politics. From a Canadian perspective, it appears as the opposite of that, where US citizens only seem willing to speak up for their self-interest.
HedonisticFrog | 17 hours ago
And then they'll blame Biden for it.
a_library_socialist | 17 hours ago
do you guys care if the empire collapses, or just that your team wins?
HedonisticFrog | 11 hours ago
You should be taking a look in the mirror when you ask that question. Only one party actually cares about the country instead of hurting out groups.
a_library_socialist | 11 hours ago
Why should I be looking in the mirror?
And while I agree PSL is the better party, that's unfortunately not relevant to this conversation.
HedonisticFrog | 11 hours ago
I figured you'd be a Trump supporter given your stance, I wouldn't have guessed communist.
gimpwiz | 5 hours ago
You don't want that unless you like a terrible amount of suffering.
Gods_ShadowMTG | 5 hours ago
Yes I wanna see the world burn
gimpwiz | 4 hours ago
If the world was a story book, you'd be first in line. Man can hope.
SwindlingAccountant | 14 hours ago
I really hope the sell off is a more strategic thing meant to tank Republicans in the midterms so Dems can reign this bullshit in because if not...yeah we're cooked.
1966TEX | 16 hours ago
So it begins
IntelligentStyle402 | 15 hours ago
We were cooked, the day, Don the Con, an amoral, individual came down the infamous golden escalator.
Lightening84 | 10 hours ago
> We’re cooked
National Debt is out of control! {buys back debt} We're cooked!
Sometimes you just can't please people.
10thflrinsanity | 15 hours ago
There are ways to protect your assets. You have AI. I’m so sick of this “we’re cooked” GenZ defeatist bullshit as if oil shocks and bond yields rising have never happened. Spend some time and learn something.
Ada_Kaleh22 | 17 hours ago
He's playing games he doesn't understand, from a position of weakness.
wrongsock_42 | 17 hours ago
He is playing a game he knows but from a new role and from a deeply weak position.
Deadeye313 | 17 hours ago
Yes. Didn't he do this exact thing happening to him, he did it to England or something?
a_library_socialist | 17 hours ago
That was under Soros
Deadeye313 | 16 hours ago
Soros was the boss, but Bessent was the guy in London to do it under Soros. Sources are mixed on who actually gets the credit for the trade but either way, Bessent was involved. Now he's the guy who has to defend the dollar or let it collapse under the debt burden.
BleachedUnicornBHole | 17 hours ago
Crashing the global economy to own the Libs.
Spinoza42 | 17 hours ago
They're trying to force a default. Displaying weakness is the whole point.
dually | 17 hours ago
Arbitrage is not a game. Buying low and selling high is a no-brainer.
Ada_Kaleh22 | 17 hours ago
someone is going to make billions off this idiot, and we will pay the ultimate bill
Spinoza42 | 17 hours ago
How do you know that someone isn't him? You think anyone in this administration is not insider trading?
Ada_Kaleh22 | 17 hours ago
yeah exactly. the wolves are inside the coop
i believe by now about 3% of the population considers him a clear and present danger. Half those people are sane and will never commit a crime over it, the other half...him being trump of course not this lackey
battlepi | 15 hours ago
He's almost dead, these moves are for the people keeping him out of prison.
dually | 16 hours ago
Bessent is making money for us by buying low and selling high.
Ada_Kaleh22 | 16 hours ago
how so? I'd like to hear it
dually | 16 hours ago
He is buying low and selling high. He's buying long-term bonds because they are priced low, and selling short-term bonds because they are priced high (relatively).
Right now the yield curve has bull-steepened and Bessent is exercising the OBVIOUS arbitrage opportunity therein.
Ada_Kaleh22 | 15 hours ago
bro the Fed is doing debt spending. what's he going to pay the short term bonds back with? more debt!
seridos | 15 hours ago
"the fed" is not doing this, the treasury is. And his job is not to set spending, treasury just has to scramble to best figure out how to do it. It's not a great position to be in. But Bessent isn't the guy who can do anything about it.
Ada_Kaleh22 | 15 hours ago
yes but at best this is just goofy. short term notes have to be rolled over or paid off, all it's doing is kicking the can down the road.
it's either a bad idea or a minor win.
Oh man I just found out how goofy this is, funny I used that word (in desperation against your certain attack). From Politico
>Guy LeBas, chief fixed income strategist at Janney Montgomery Scott, noted that Treasury also issued $39 billion in new 10-year securities on the same day, optics that he referred to as “a little goofy.”
dually | 15 hours ago
The Fed remits it's net earnings directly to the US Treasury it does not have an operational deficit or debt.
Uno_worldchamp2009 | 17 hours ago
I took 3 economics classes but dont quite understand the implications. Can you explain what that means at an undergraduate level?
Ask_Individual | 17 hours ago
They are effectively shortening maturity by buying back long term obligations with short term money in an effort to reduce interest expense and hold down yields. The effect will be lower interest cost because short term rates rates are lower than long term rates.
But there's no free lunch and the trade off here is called rollover risk when it come times to refinance the shorter term money. If rates rise, the debt service cost could escalate quite dramatically.
The Fed could step in and act as a buyer, but in a rising rate environment, there are consequences because the way the Fed "creates" money is by creating bank reserves against which they must pay interest at a short term rate called IORB. Today that rate is 3.65%. If short term rates rise, this interest on reserves adds a layer of interest cost to the government on top of what it pays on the bonds. If short term rates are held low, it could cause inflation to run away.
By illustration, in prior periods where the Fed was practicing loose monetary policy, it was creating reserves in a zero or near zero rate environment which is very different than today.
Honestly, the only healthy answer is deficit reduction which means increased revenue (taxes) and/or reduced spending (austerity). Or war.
DDGBuilder | 17 hours ago
So it's like paying your mortgage with your credit card that is currently at a lower promotional rate?
a_library_socialist | 16 hours ago
well put
And that only makes sense if you think you're either going to have lots more money in the future . . . or you don't intend to pay
MoonBatsRule | 16 hours ago
Or if you know that you won't be in power when the day of reckoning comes.
SharkMolester | 15 hours ago
The children vote every 4 years whether mom or dad gets the credit card. The parent that promises to spend less never gets the votes.
MoonBatsRule | 14 hours ago
Why can't a parent promise to work harder/smarter and earn more?
a_library_socialist | 13 hours ago
Because GDP growth has been below 3% for decades.
MoonBatsRule | 12 hours ago
The equivalent of my analogy would have been "raise taxes".
gravescd | 16 hours ago
This is also an inflation game. Bessent is trying to pull the inflation forward by exchanging long term bonds for short.
But without any plan to reduce principal, this is basically an adjustable rate mortgage that we keep adding to. Because inflation compounds, shifting the inflation from the last years of the "mortgage" to the first years results in way more interest over the whole term.
What the bond market sees is that we're going to increase near term inflation but not do anything to reduce future interest expense. Even if we get over the inflation hump in a few years, on a 30 year timeline, we're still experiencing much more inflation than if it happened at the 20 year mark.
DogadonsLavapool | 13 hours ago
Great summation. Actually helped me understand it
Past_Top3704 | 17 hours ago
So War it is.
I see - thanks everyone!
GerryManDarling | 16 hours ago
This is just a brilliant plan to pass the recession to the next administration.
big-papito | 14 hours ago
They are not going to cut spending - they are likely to cut MORE taxes.
In any case, what I am hearing is - buy gold, the rates are not going up. Am I understanding this right?
RedParaglider | 15 hours ago
But that problem is someone else's right because even short-term is going to be into the next presidential term.
The_Great_Saiyaman21 | 14 hours ago
> If short term rates rise, this interest on reserves adds a layer of interest cost to the government on top of what it pays on the bonds.
Maybe I am misunderstanding your point here, but that is not how the Fed's accounting works. If the Fed buys the bonds, the Treasury pays the bond coupon directly to the Fed. The Fed then pays the IORB to commercial banks out of its own asset earnings, not as a taxpayer expense. Any net profit left over is transferred back to the Treasury via weekly remittances. The government isn't paying another layer of interest, the original bond interest is refunded back to the fiscal budget. In this scenario the floating IORB rate is the only net cost.
Traditional-Rock-365 | 13 hours ago
Is this like paying one credit card with another because the rate is lower?
pantsmeplz | 12 hours ago
Was the "war" answer sarcasm or does it have an economic input to this equation?
Ask_Individual | 11 hours ago
Somewhat sarcastic, but in broad historical terms, there is a pattern of dominant military powers securing economic dominance and exploiting the other countries they have subordinated. The United States did it very effectively after WWII. The British, Dutch and even the Romans did the same. The establishment of the world's financial system being built around the U.S. dollar as reserve currency created what the French call the exhorbitant privilege of the U.S. That one post-war spoil is a large contributor to growth in U.S. wealth.
A healthy, cooperative global community discourages the possibility of economically motivated conflict, but that's not what we have right now. I realize we're off the main topic of debt management right now, but suffice to say, the Treasury can only get so far manipulating maturity, we have to either cut spending or raise revenue at some point. Other than the tax base, another way of raising revenue is siphoning wealth from someone else, which is where military action enters the equation.
pantsmeplz | 11 hours ago
>Other than the tax base, another way of raising revenue is siphoning wealth from someone else, which is where military action enters the equation.
That's what I was assuming. Just seems like that "business model" may not work well in the current era unless it's to emulate China and Russia's neo colonialism.
Ask_Individual | 9 hours ago
I can't say for sure, but it is well known that Ukraine was the bread basket economic crown jewel of the former Soviet Union, which is all the incentive Putin ought to have needed to streamroll in and try and annex it.
Maybe a country or two sitting on a lot of oil would be a likely target. Venezuela and Iran come to mind. Greenland's natural resources are estimated in the trillions. Who knows?
jatd | 12 hours ago
Their thinking is that inflation is transitory...it's supply chain issues and the Iran war. The inflation is all man made.
Oryzae | 7 hours ago
So the bet is that interest rates will be cheaper a year from now (assuming short term debt here is something that matures in like a year)?
1900grs | 12 hours ago
> Or war.
Yeah, we have that already and supply munitions to many countries. That avenue is tapped unless you mean war crimes like pillaging oil and we're already doing that too to Venezuela
Pitiful-Mongoose-488 | 17 hours ago
The US treasury is essential using credit cards to pay off it’s mortgage
Cdub7791 | 14 hours ago
Hopefully we're getting some cashback points at least.
TreyAU | 17 hours ago
Which part? I might be able to help here.
Uno_worldchamp2009 | 17 hours ago
Did bonds yeids initially drop because they were being repurchase before their maturation date? If so, why did it do the opposite when the US gov decided to buy back more?
Spinoza42 | 17 hours ago
Apparently the current reading is that the buyback was smaller than expected.
loopernova | 15 hours ago
I’ll try to explain in the most simple terms the way I understand why yields dropped initially then increased with the new announcement:
Our baseline is going to be supply and demand. When supply of something goes down, assuming all else stays equal, including demand, the price of that will go up. And when supply increases, prices go down.
With bonds, yields have inverse relationship to the price. As price goes up, yields go down, and vice versa. The basic mechanics of this is simply that if you pay more for something your ROI (yield) goes down. The interest is fixed on the bond, but you’re paying more to get it.
The standard operation has been up to $2b buyback per week since the program was launched in 2024. In August when it was announced this would increase to $4b, this was somewhat of a surprise. Suddenly there could be more long term bonds being taken off the market (decrease in supply). So the prices increased, lowering yields.
But with this surprise, the market also tries to price in what they expect in the future. There was some speculation that buybacks could increase further. So when this new announcement came just a month later, it had already been priced in. Although the market seems to have somewhat overshot that price prior to this latest announcement, so it’s now just correcting by decreasing the price, increasing long term bond yields.
iAwesome3 | 17 hours ago
This guy made a great video explaining what the fed is trying to do and why it's not working well.
https://www.youtube.com/watch?v=QmWyQ-BCD8E
Charming_Ask_1961 | 17 hours ago
What they’re doing is the rough equivalent of paying down your mortgage with your credit cards. The most generous interpretation is that it’s a cynical ploy to keep mortgage rates from going up higher before the midterm elections.
bishbah01 | 17 hours ago
Patrick Boyle had a pretty good explainer.
Lord_Vesuvius2020 | 17 hours ago
I just checked. The US10Y is at 4.843%. It doesn’t look like Bessent is taming the bond market.
crustyrobots | 17 hours ago
The dipshit is trying to put out an oil fire with kerosene
Lord_Vesuvius2020 | 16 hours ago
Indeed! You probably saw where he was quoted “I am the house” which became an instant meme of the Tom Hanks scene with the Somali pirate “I am the captain”.
bejammin075 | 15 hours ago
Bessent: "I am The House"
Market "The roof, the roof, the roof is on fire"
crustyrobots | 13 hours ago
People: "we dont need no water let the mother fucker burn. Burn motherfucker. Burn"
Chronochrome | 17 hours ago
The buyback reeks of desperation and doesn't do anything to inspire trust in the USA's ability or willingness to be good partners. Without changing their fundamental approach at the macro level (more responsible taxation, better trade agreements, and the removal of excessive tariffs), this admin will continue to crash the dollar.
And the best part is that Republicans will see the weakness of the dollar as wages stagnate and inflation climbs, and they'll keep asking themselves why Kamala would ever do this to them. Poor Trump, so helpless and feeble...thoughts and prayers.
OK_x86 | 17 hours ago
They dropped on the 19th and then rose again sharply the 20th as I recall.
goodbodha | 17 hours ago
I think people misread that one. The peak was in pre market on the 18th. The public announcement was in pre market on the 19th. Who is to say a heads up didn't go out over that 24 hour period?
I think the connections Bessent has to the people who short Fx is significant and I won't be surprised if unofficial communication isn't happening daily.
As for today, it seems more like a retest of that peak yield. If it breaks 5.335% then it really matters. Otherwise I would see this as an excellent buying opportunity. I won't be surprised if we are back down to 5.25% or lower tomorrow. If we get the long bond to 5.2% by the end of the month that could make this a meaningful peak.
The real issue is that while people are watching this the cost of capital for the broader economy is going up and a bunch of selling is happening in equities.
OK_x86 | 17 hours ago
Nice try Scott Bessent.
Jokes aside you might be onto something. But regardless it is also fair to say that if this was the treasury department trying to fix the bond markets its impact has been pretty muted so far.
Investors in these markets know that the underlying issues remain unaddressed and anything Bessent does at this point is a band aid at best. This is not a long term solution
big-papito | 17 hours ago
10-year at 4.84 - good job!
vertigo3pc | 16 hours ago
>Aug 19, buyback doubled to $4B, yields dropped
The yields only went down for less than 24 hours. Wednesday the announcement was made, and by Thursday the yields were back up at 5.25% on the 30yr.
Very soon, the market will not even flinch at these buybacks because investors will see the USA as a sinking ship, and even with higher and higher interest rates, they will be skeptical to buy. The reason: investors do not have faith in the "full faith and backing of the United States" anymore.
The Fed's independence is being threatened, and even with raising it's interest rates, investors will be concerned and avoid investing the more hostile and desperate the USA becomes.
2Hanks | 17 hours ago
Fool me once shame on you, fool me twice, won’t get fooled again.
morbie5 | 17 hours ago
> Today, tripled to $6B, a bigger intervention
6B still isn't that much considering the size of the treasury market
DeathCabForYeezus | 17 hours ago
Is this a case where the treasury is trying to take medicine without admitting it's sick, and the market is calling it what it is?
DueSignificance2628 | 16 hours ago
The Iran war is costing $1bln/day, so is the buyback using $6bln really that much by comparison, in terms of how much it can influence markets? It'll pay for less than a week of the war.
Dizzy-Eye2900 | 13 hours ago
it suggests investors are currently more worried about holding long-term U.S. debt than they were a few weeks ago for sure..
Atsir | 16 hours ago
Whisper number was $10b so market is disappointed
No_Bad_4872yy | 16 hours ago
CNBC has a pretty cool new banner saying 'New 52 Week High Today' on the ten year.
https://www.cnbc.com/quotes/US10Y
UwUAlpacas | 13 hours ago
So, they're buying back longer term debt.. is this old sub 2% stuff that they're certainly refinancing, or new 30 yr to reissue as short term?
Either way it sounds fairly futile to me at best, dumb at worst.
0o0o0o0o0o0z | 13 hours ago
The bond market is like the honey badger: "it just doesn't give a fuck." And since we either have 0 economic policy or insane economic policy from the WH... the bond markets are gonna be the adult in the room.
shadowromantic | 9 hours ago
That's because these numbers are laughable.
Name_Taken_2017 | 7 hours ago
Thank you Scott, these bags were getting heavy
Rekrabsrm | 2 hours ago
The only reason the stock market is rising is because of inflation. This bubble pop is going to SUCK.
ExpatLivesMatter | 17 hours ago
This move reeks of Desperation, as the markets already know that both BOJ and US Treasury are playing whack a mole, in their desperate attempt to forestall the inevitable yield rise. Trump's utter lack of fiscal plan is the core reason that the markets are disregarding buybacks. The current 10yr yield agrees with my statement 🤦🏼🌮🤷🏼🤣
thri54 | 15 hours ago
I wouldn’t say it reeks of desperation. The US government debt grows by $7B per trading day, not including re-issuance. A $6B purchase doesn’t even cover a day of treasury issuance.
The federal reserve has unlimited discretion to enact monetary policy. They bought $100’s of billions of debt per week during the pandemic crash, provided over $1T in overnight repos, etc. They have the ammo to affect rates.
A token $6B buyback shows that Bessent doesn’t actually want to interfere with the debt market beyond giving Trump a headline, which is why debt markets reacted negatively. This is all bark and no bite.
ExpatLivesMatter | 14 hours ago
Well, according to the current 10yr yield climb, that dog is toothless.
mouthful_quest | 9 hours ago
Bessent is underestimating Bond Vigilantes just like Trump underestimated Iran
Caster0 | 13 hours ago
Yep, it's literally self inflicted but people tend to be most vocal about the fed, who can't do shit right now due to the economy going sideways
ExpatLivesMatter | 13 hours ago
Yup, the Fed is standing outside, BITING its nails, going WTF!
kent_eh | 13 hours ago
> Trump's utter lack of fiscal plan
Trump and everyone surrounding him.
ExpatLivesMatter | 12 hours ago
I said Trump, since his Cabinet has been firmly vedged up his arse. His latest sitting position pictures show that 🤣
moonski | 11 hours ago
The only thing you achieve trying to do this is finding out how much money you wasted trying to fight the markets. It never works.
Jalapenoplanter | 17 hours ago
Average gas is $4.22 nationwide right now. I can personally say that my gas station went from $4.00 to $4.40 this week so it seems possible that gas will hit $5 this year as the SPR runs down, canadian gas stops coming to the Us, russia, and ME gas keeps being blown up unless something major changes. I would bet that unless trump stops saber rattling, canada will temporarily restrict gas to the US in october to make midterms hurt republicans
This plus tariffs will lead to inflation increasing, interest rates having to go up to try to stop it. Bond market is dumping. Anyone on an adjustable rate mortgage is probably gonna lose their home.
Then Jan 1 a bunch of people are going to lose their healthcare because of trump’s bbb.
We are absolutely in an AI bubble.
This is shaping up to be a baaaad 2027.
Slumunistmanifisto | 17 hours ago
Im seeing cents away from six a gallon in the pnw
es-ganso | 17 hours ago
Yep. Gas prices around Seattle are rough
iSeeXenuInYou | 13 hours ago
I saw 6.30 the other day in Seattle. Mostly around 6, but 6.30 was the highest i've ever seen in person.
bammerburn | 13 hours ago
Doesn't stop drivers from clogging the roads, though?
Potato-Drama808 | 13 hours ago
What should they do, stop working?
sPoonamus | 13 hours ago
You know they were sipping on their soda that came with the burger and fries they had delivered to their door when they posted that headass comment
bammerburn | 13 hours ago
All I said was that high gas prices certainly aren’t stopping drivers from jamming up roads. Am I wrong?
xinorez1 | 8 hours ago
If you're upset that the oil industry is making outsized profits like in the oil crisis of the 70s, you're just poor and unamerican.
/con
Sea_Dawgz | 17 hours ago
Saw $6.90 in LA yesterday.
12ozSlug | 16 hours ago
(not) nice
phillyfanjd1 | 7 hours ago
nicen't
musicman835 | 10 hours ago
That depends on the station but definitely some stations.
I paid 5.59 but the one down the street was 6.50
I don’t know how they survive the difference.
Medical-Button-5493 | 7 hours ago
Nice
bpep1012 | 17 hours ago
Diesel in Heber City Utah. Is $5.99 as of this morning.
whapitah2021 | 16 hours ago
Oh you rich folks in Heber be all right, you got this!
bpep1012 | 14 hours ago
We’re not all rich.
BasvanS | 15 hours ago
So, 6.50 by the time they can’t keep it under 6 anymore?
Own-Chemist2228 | 15 hours ago
Ouch!
I feel really sorry for those suburban ranchers driving their kids to soccer practice in their F350s.
Mr_IsLand | 15 hours ago
$5.99/gal diesel spotted in central KY just a couple days ago
shottylaw | 15 hours ago
Just drove to bend. Diesel was 6.28. I chuckle watching these rolling coal boys pay that
Slumunistmanifisto | 15 hours ago
Lot less of um in the left lane on i5
crustyrobots | 13 hours ago
Ive also noticed around me rurally that I think if people have another car to drive they're driving it. Definitely seeing less of these big stupid trucks lately.
Slumunistmanifisto | 13 hours ago
I love me a big burly bearded camo wearing redneck in a faded teal geo metro.
Its like a version of the stripper index.
shottylaw | 15 hours ago
About to be a lot less of everything on SB I-5
cries in WA commuter
PoliticalSasquatch | 15 hours ago
Yeah but highway trucks and farm tractors also run on diesel and yes I know most of those guys also voted trump but hear me out.
So now those guys feel it in the pocket right away but that’s going to get directly passed on to consumers and inflation is going to skyrocket. Problem is the economy is dependent upon diesel to transport basically every good and service we need and it’s not just trucks and tractors but trains and ships too.
APACKOFWILDGNOMES | 14 hours ago
Yup and tons of multi generational farmers are going to have to sell when they can’t find enough demand for their produce. Huge corporations will buy up that land for pennies on the dollar and the food prices will be jacked up even more. This is a direct result of the incompetence most farmers voted for. It’s our job to make sure they see the connection and feel the consequences so that they can accept and change their views. There’s a half dozen plus different bubbles on the verge of popping. We’ve managed to skate on by for the past couple of years while they’ve gotten bigger, but we won’t be able to do that indefinitely. I only hope that we elect someone who can put strong regulations on markets and companies to ease the blow on the average consumer and spread the risk back onto the wealthiest in the economy. I doubt the country could withstand another bailout like in 08. We simply don’t have the means to do it without causing a depression if multiple bubbles pop near the same time.
crustyrobots | 13 hours ago
We have a bunch of these diesel queens around here. I also laugh every time I hear one of the blast down the highway with their detuned POS on rubber band rims sticking out. Like wow, that sounded expensive lol
RedParaglider | 15 hours ago
I take a vacation up to Utah to paraglide every year and I canceled it this year. Fuel too damn high.
Medical-Button-5493 | 7 hours ago
Bessent saved you from a spinal injury
TimSylvester_ | 10 hours ago
According to Trump that's just not a big deal and he doesn't think about it at all.
Slumunistmanifisto | 10 hours ago
Yeah I know....he only thinks of the children
zen_and_artof_chaos | 17 hours ago
They are talking about national average, not localities. It will obviously be higher in certain areas.
opal2120 | 17 hours ago
If only conservatives could figure out who is to blame for the economic hardship. They will be screaming about Biden through the end of Trump's presidency.
joebalooka84 | 17 hours ago
Obama did it. Whatever the problem is. He opened a tan suit factory in Asia.
ispeektroof | 14 hours ago
It’s so weird the tan suit sent the racists over the edge.
jackal_actual | 14 hours ago
Is it though? Is it?
ComradeJohnS | 14 hours ago
yeah, it is weird because they’re all weird losers.
Message_10 | 13 hours ago
Well, Sleepy Joe Biden did invade Iran, so they can say that.
/ssssssssssssssssssssssssssssssssssss
Educational_Report_9 | 14 hours ago
You must remember that Trump inherited this very poor economy. He's ONLY has two years to fix it. Tariffs and war will definitely fix it just give it time!
Craigboy23 | 17 hours ago
*Universe * Hey, just for kicks, let's throw a super El Niño on top of it all, for some extra spice.
nosayso | 17 hours ago
Yeah, we're so beyond fucked day to day the Trump years have basically doomed our climate change response and thus the outlook for humanity in general. Instead of some measured progress, which would still certainly not be enough to fully prepare but better than doing nothing, we've done worse than nothing and actively regressed on sustainable energy.
Next president maybe gets 8 years to dig us out of this hole, probably not a ton of time to focus on combatting climate change given all the other disasters Trump is causing, before the pendulum swings back to the next fascist to drive us fully into oblivion. 2037, it'll be here before you know it, get to head into my 50s living in a full on climate crisis.
And that's the optimistic version where there is a next Democratic president in 2029 and not just even more extreme descent into fascism and cancelled/fraudulent elections.
chasingjulian | 17 hours ago
If our elections are untampered and we elect a Democratic president and all they do is focus on climbing out of this hole we find ourselves I am sure that president will be rewarded by losing the 2nd term.
dust4ngel | 14 hours ago
> I am sure that president will be rewarded by losing the 2nd term
"they made us do a gay solar!!!"
crustyrobots | 17 hours ago
Well, us future uncs will have to band up in the Water Wars. Ive seen all of the Max Max movies, well be fine
ThereGoesTheSquash | 17 hours ago
Ironically, this will all eventually act as a carbon tax that no one had the political will to enforce (good thing). As someone who spent a lot of time and money creating a home that is net carbon negative, I am pretty pleased with myself.
Buy your ebike now folks! The world is about to change.
o08 | 15 hours ago
Global carbon emissions reduced in the first presidential term, so there is a track record of success, from the monkey paw of consequences view.
ThereGoesTheSquash | 15 hours ago
I’ll take whatever I can get at this point
Koshindan | 12 hours ago
Just realized the pendulum will switch back right when the 2038 problem is supposed to occur. I'm sure there be consequences for that.
Scrandon | 16 hours ago
It’s not that bad. We’re already doing much better than initial “current state” projections that were around +3-4 degrees Celsius of warming. Now we’re looking at +1.5-2.
And that’s with no help from these worthless conmen known as republicans and the most delusional old fuck ever as President. Even Ron Desantis admitted to climate change in the primary, he just lied that the free market would fix it.
Every day green energy gets cheaper and better and some stupid old boomer has their house wrecked by horrible weather. I’d love to see a clean planet and we have a long way to go, but I’m more optimistic than I’ve ever been.
sly-3 | 14 hours ago
Because the Donor Class doesn't care if the union breaks, the next "President" may not be in charge of all 50 states.
aNewHope_v_ThaEmpire | 16 hours ago
Yeah, a lot of the people who will be losing healthcare are a lot of the same folks who are more vulnerable to health risks posed by extreme heat events.
Cue the "This is fine" dog meme.
Cultural-Company282 | 17 hours ago
To which Republicans will say, "See? The Democrats won the House, and the economy collapsed! Vote for us!!!"
nutacreep | 17 hours ago
And the morons will believe them every time
Dest123 | 17 hours ago
It doesn't matter if they believe them or not. They'll support Republicans no matter what due to tribalism just being human nature. If Republicans win or steal the midterms, then they'll just come up with some other reason why voting Republican is good. It's a huge flaw in human nature and why propaganda is basically the ultimate weapon and so effective. Russians are dying every day while still thinking that Putin is great. People literally kill their own kids in cults.
Caster0 | 13 hours ago
Yep, that's pretty much how the Dems lost the House right after gaining it during the financial crisis
Cultural-Company282 | 13 hours ago
Yup, and the inflation that doomed Biden/Harris was a direct byproduct of post-covid spending that mostly happened under Trump.
clarity_scarcity | 17 hours ago
That’s actually brilliant, Canada shuts down all US oil exports ahead of the midterms. Short term pain for Canada, huge kick in the nuts for Trumpistan. I have popcorn on standby
elebrin | 14 hours ago
I am certain there are places in Europe, Africa, or Asia that they could ship it.
morbie5 | 17 hours ago
> canadian gas stops coming to the Us
Canadian oil, not gas (unless you are talking about natural gas, but that isn't as big an issue for the US) and neither is going to happen anyway imo
bradeena | 13 hours ago
There are currently a lot of things happening that I previously thought would never happen
Zerot7 | 17 hours ago
Yeah the only way Canadian exports fall is if Iran blows up Keystone or something similarly improbable. If the feds restrict Alberta’s ability to export it will give a huge boon to Alberta separatists movement.
calgarywalker | 16 hours ago
We’ll see what’s left of that “movement” after Oct 19. It’s already on life support with a ringleader on the hook for $100miion and the prov not releasing the viability study they commissioned.
Zerot7 | 16 hours ago
Ah I’m a pessimist now when it comes to this stuff working out. To many billionaires and foreign governments pumping us full of garbage on the internet and TV to their own ends.
crustyrobots | 17 hours ago
Regular is 4.40, diesel 5.80 here
And its becoming "need gas to heat our homes and live" time
ydwttw | 17 hours ago
Canada will match any US escalation, but we aren't likely to escalate ourselves.
Plus we don't have much refining capability. So if we restrict crude exports, the US just restricts gas exports to us.
CoachoftheYear2025 | 13 hours ago
Impeach the mother fucker already.
martin | 17 hours ago
Just in time for the fresh bagholders to be seated.
SeaEmployee787 | 16 hours ago
florida is 4.20 and indiana is 4.50 ish. as of yesterday, 5 is not out of the question. old enough to remember 2008, economy was alwful and gas was super high.
Wrong-Camp2463 | 15 hours ago
2028 will be much worse. Buckle up!
Knerd5 | 15 hours ago
Where I'm at diesel is up $2.40/gallon from the start of August. Cheapest station near me is $8.
RedParaglider | 15 hours ago
From what I understand the Chinese government is starting to buy oil again. That was really what was suppressing prices so heavily is that China basically just stepped out of the market using their reserves.
darkmeowl25 | 15 hours ago
I live in one of the 5 states with the lowest gas prices. We're at about $3.75-$3.80 right now. For comparison, I found it in the nearest metro for $1.99 in December 2025. I fear I shan't ever see that number again.
People always looked at me crazy when I said "People have no idea of the fate they've chosen." I don't even get the satisfaction of "I told you so" because being right about this shit is not a win for me, it's a loss for everyone.
vox4penguins | 15 hours ago
just south of Milwaukee here, and our gas jumped .40 cents overnight yesterday
DrewDown94 | 15 hours ago
Hate to be a Debbie downer, but we can't forget about looming super el nino and the inevitable famine it causes.
Sea-Ambition-451 | 14 hours ago
don't forget, Iran can make a few tactical moves that would greatly exacerbate the problems for the exasperated Americans.
There really is a perfect storm on the horizon.
some_where_else | 14 hours ago
*exacerbate
Quentine | 11 hours ago
What can we do to protect ourselves? Buy gold?
lunchbox_tragedy | 8 hours ago
Most ARMs have caps on how much the rate can increase, so that’s a bit hyperbolic
font9a | 7 hours ago
Well at least republicans in congress will declare some emergency measures to make sure the billionaires can profit from all these economic calamities.
Medical-Button-5493 | 7 hours ago
What's the hedge? T bills? GLD?
brute-forced | 17 hours ago
You know… This is by far the most corrupt government ever to have exist in the United States of America, and they are simply trying to speed run bankruptcy for the entire nation and under 2 1/2 years it’s truly miraculous
MattintheMtns | 17 hours ago
*speed bankruptcy to help the oligarchs gobble up more of the assets.
callmetom | 17 hours ago
I’ve been saying this for a long time. COVID showed just how beneficial a crashing economy is for those with the money to buy everything cheap. COVID isn’t going to happen again, so we have to force people into needing to dump assets cheap in other ways.
CapitalElk1169 | 17 hours ago
The thing people really don't get when they say Trump is compromised by Russia is that that isn't true at all; he's not compromised, he wants to be the Putin of the USA.
Right down to mimicking the fall of the USSR, where the oligarchs were able to steal everything that wasn't nailed down.
kingofshitmntt | 14 hours ago
The idea that Putin pulls the stings on everything is insane. People have agency themselves and blaming some outside actor for everything removes any sort of idea that people in this country can have their own awful motivations.
Practical-Bottle8900 | 13 hours ago
Well, Trump is compromised by Israel way more than Russia.
StaffOk9715 | 17 hours ago
They got too good at controlling crashes honestly. Under the pretext of protecting the economy, they developed a bunch of tools that ensure the rich get richer in a crash and the bulk of the cost of the crash is passed on to regular people in sneaky ways like shrinkflation, rent prices and etc. The regular people get mad at these changes but have a hard time pinning down the actual cause. The politicians then insert causes into public thought that are beneficial to the rich and much of the public falls for it.
Ada_Kaleh22 | 17 hours ago
In Ohio some are saying if Vivek Ramaswami wins all sorts of state-owned assets will be turned over to the private school industry/maybe religious nuts to keep them in line
dust4ngel | 14 hours ago
> COVID isn’t going to happen again
we have RFK Jr, don't lose hope in a new and improved pandemic
Ok_Vulva | 14 hours ago
It was also written in their project 25 plan. So like it's not just anyone's feelings. This was deliberate and written down and given to people to see before they voted.
kingofshitmntt | 14 hours ago
Wealth accumulation at this insane level is a mental illness. Totally worth risking collapsing economies and devastating peoples lives so you can get some more brownie points among fellow rich.
aNewHope_v_ThaEmpire | 16 hours ago
And perhaps more dangerously, to intentionally crash the dollar so they can force a transition over to crypto and CBDCs that they control.
They want to create a situation under which the can literally dictate what we can and can't spend our own money on.
Subject_Offer_9621 | 17 hours ago
They're definitely the most blatantly corrupt
The amount of times they play with the market is atrocious
Old-Flight8617 | 17 hours ago
They are doing the Private Equity special to the US economy.
TheRealBittoman | 16 hours ago
Anyone actually paying attention during COVID with all the property being bought off the courthouse steps by equity groups and the private wealthy should have figured out where this was likely to go. At this stage the "you will own nothing and like it" is their motto. They want anyone south of a multiple of billions of dollars to be bankrupt so they can finish what COVID started. The death of the US.
SinCityDisturbia | 16 hours ago
People who voted for and allowed this to happen need to held accountable. Dismantling this nation from the inside out is not some big accident.
Leaving our kids with a mess to clean up just like our elders did to us.
vertigo3pc | 16 hours ago
> bankruptcy for the entire nation
Begs the question: why? Bankruptcy protection doesn't exist for countries and creditors, and by destroying the US economy, they will destroy a number of other countries' economies when their considerable investments in our economy become insolvent.
We're at the brink of where the USSR was in August/September 1991.
handsoapdispenser | 15 hours ago
Trump is stupid. He thinks he's smart. Republican legislators are gutless clods who only care about staying in office.
Glidepath22 | 17 hours ago
Circular financing, like paying off one credit card with another with higher interest rates. America’s financial power has largely been based on the confidence of its stability, now we have some delusional asshole in the White House with an equally unqualified not-serious administration
Own-Chemist2228 | 18 hours ago
This is normal for a healthy booming economy...right?
(Yes it was sarcasm, and I'm explaining that so that I can get 140 characters into my post.)
twenafeesh | 18 hours ago
>Market reaction, however, was negative. Treasury yields rose further but were volatile with long-dated securities rising as much as 5 basis points each before easing.
Nothing to see here. Bessent totally knows what he is doing and markets have taken notice. Carry on as usual!
Ada_Kaleh22 | 17 hours ago
Look he's just taking money we have, to pay off money we owe, by borrowing money! It's simple really!
OK_x86 | 17 hours ago
This feels like Dennis and Mac trying to start their own self sustaining economy more than it should coming from the secretary of the treasury
CheeseburgerLocker | 17 hours ago
Lmao classic scene. "What are we doing here Mac?" "I don't know I was going with what you were saying!!"
When they realize something is wrong yet Mac keeps doing the circles 🤣
Ada_Kaleh22 | 17 hours ago
Is that not what Putin has been doing since his little plan blew up in his face?
WhenThatBotlinePing | 17 hours ago
I blacked out that night
crustyrobots | 17 hours ago
See, Bessent is just playing both sides, that way he always comes out on top
Droggles | 16 hours ago
I guess it’s time for America to separate the wheat from the chaff! And we’re all chaff!
kinkysubt | 17 hours ago
Former Soy Bean man, Scott Bessent, is a staunch professional. A genius really. He’s the best people, totally fierce. Trump only brings in the most smart, fierce genius people. That’s why we’re all doing so great you know. Truly a golden age! /s (so much sarcasm.)
StinklePink | 17 hours ago
This is like paying your mortgage with your credit card. We are essentially swapping long term debt with short term debt.
Watch the activity around the 10-year. Everything is based on that and THAT is the canary in the coal mine.
crustyrobots | 16 hours ago
Good thing the 10 year rate hasn't been exploding today...oh wait
Orange_Tang | 13 hours ago
It exploded today because of this.
kent_eh | 13 hours ago
> We are essentially swapping long term debt with short term debt.
Yes, but have you considered that Trump and his accomplices don't expect to be the ones who will have to deal with the fallout when the whole thing comes crashing down.
Sea_Dawgz | 17 hours ago
This is superbad that they think this will do anything to ease the minds of people worried about the 40 trillion we owe.
Like, the $6 billion is peanuts!
Sea-Ambition-451 | 14 hours ago
The ratio is 0.00015
L4gsp1k3 | 17 hours ago
Well he did say that he's the house and the house can never lose !!!!!
If the FED doesn't hike in September, poor long terms bonds and the trust of the American economy.
Ada_Kaleh22 | 17 hours ago
well they've convinced the market that they will, so when they don't...oof
L4gsp1k3 | 17 hours ago
Long term bond trends are showing a deterioration of trust in various western economies. Maybe a couple of decades of cheap money isn't the best way to go. Let the economy go boom and burst to avoid huge pile of debt.
bejammin075 | 15 hours ago
When Bessent said "I am the house" his voice was super shaky, like he was nervous as hell.
L4gsp1k3 | 13 hours ago
Maybe it's a sign, like i'm the "shaky" house, meaning that the house is shaking and inevitable going to crash down ?
bejammin075 | 12 hours ago
I fancy myself as somewhat of an auditory lie detector. I have a knack for it. Bessent had no confidence in what he was saying. He knows he's bluffing and terrified the bluff will be called.
NeverVegan | 17 hours ago
I thought Bessent was the House now?? This seems counterintuitive. Words words words words words words words words words words words words words words words words.
LifeRound2 | 17 hours ago
Buying back debt with debt? The best you can do is refinance with a lower rate or stretch out payments to a longer term to lower the payments.
sonofalando | 15 hours ago
They could just cut tariffs, make trade peace, sue for peace with Iran, and just reduce import costs, but nah, let’s just try to prop up treasuries and fight the massive bond market instead. Clown show.
Intelligent-Back7062 | 16 hours ago
$6 billion agains an outstanding $40 trillion in Treasury debt, and he thinks the market will react favorably? Stupid is a high compliment
DeliciousPangolin | 15 hours ago
I doubt Bessent is dumb enough to believe this will work, but the Mad King must be appeased. He's playing for an audience of one.
Estcher | 16 hours ago
I always get the feeling that these guys are intentionally destroying the world around them. They see some future where their insane ill-gotten wealth protects them while everything burns. But this smarmy fuck takes the cake. The smirk on his face is infuriating. Where is the fucking karma???
jeezfrk | 17 hours ago
Hello oil silo, here's one quart of oil for you!(The normal level of purchases each day is a trillion dollars.)
One must remember that the Fed does things to affect bond yields and attractiveness. This is the US Treasury instead pretending to act like Papa.
Our tax-revenue deficit should increase to fake propping this monstrosity upwards? We are spending debt to pretend people want to buy more of our debt.
The response not long after from the market was to be more fearful and tight-walleted.
Ada_Kaleh22 | 17 hours ago
>We are spending debt to pretend people want to buy more of our debt.
Nailed it bro
TortyPapa | 17 hours ago
Term premium not good enough when you are actively fighting a war you can’t seem to get out of.
The macro > micro. Simple supply and demand. Daily trading at 1 trillion (000,000,000,000).
One billion seconds is ~31 years. One trillion seconds is ~31,000 years!!
DeadInternetVoid | 18 hours ago
BOOMING
ECONOMY
I'm writing this so I don't get fined.I'm writing this so I don't get fined.I'm writing this so I don't get fined.I'm writing this so I don't get fined.I'm writing this so I don't get fined.I'm writing this so I don't get fined.
Ada_Kaleh22 | 17 hours ago
brain already exploded sorry
OddlyFactual1512 | 17 hours ago
Just a reminder, neither the Fed nor The Treasury sets bond yields. Those are determined by the free market, and the free market is telling us that our does not like this.
Edit: spelling
EmperorOfCanada | 7 hours ago
Kind of. There are other levers the federal government can use to "force" bidders to the table. State department, banking regulators, etc.
It would appear the capacity of these levers is becoming limited.
ButtStuffingt0n | 16 hours ago
"Once markets believe Treasury is defending a price, every rise in yields becomes a test of official resolve, and the operations must grow to survive the tests.” - Stan Druckenmiller
Bessent is going to get smoked if he keeps doing this. Buy gold.
Straight_Flan1347 | 16 hours ago
Totally cool and normal thing for a totally fiscally sound government to do to it's completely, totally, absolutely trust on us this stable bond market.
kismethavok | 17 hours ago
I still absolutely love(hate) how people are ok with companies and governments buying back their debts... Somebody fucking put 2 and 2 together please for the love of fucking god.
3_Thumbs_Up | 14 hours ago
There's nothing wrong with buying back your own debt in principle. It's essentially paying back creditors early at the current market rate. The creditors have a choice to set their own price to accept an early repayment, or wait until maturity.
It's kind of a big part of the point of bonds. Why would you even hate it? Who is supposed to be the loser when a company repays a creditor at a price the creditor accepts?
The current debt swap is just stupid though, but that's mainly an issue for the US government and their constituents.
PurpleReign123 | 17 hours ago
Unlike Hank Paulson’s bazooka, Bessent’s itty-bitty bazooka looks broke, wimpish and smells of desperation. Markets are not buying this. 10-yr and 30-yr treasury yields are up since Bessent unveiled his latest bitty bazooka.
Tribe303 | 14 hours ago
Man o' man, do I sleep well at night, knowing I'm Canadian and our leader knows exactly how all this shit works. Somehow we have half the US debt per capita, a higher credit rating AND lower interest rates!
Psyclist80 | 16 hours ago
Ahh yes, using one credit card to pay off another...sound financial plan...I cant see what might go wrong here. /s
I wonder when America wakes to to the fact that these clowns dont have thier best interests in mind. Speed running the demise of the USA, socially, politically and economically...Wake up America and do something!
aeiendee | 13 hours ago
Isn’t the end game of this like, the demand placed on the government to sell bonds will keep increasing (to service the interest), and potentially the demand for those bonds will drop, making rates even higher? I don’t see how much longer they can be low for?
already-redacted | 13 hours ago
This feels almost more like corporate finance than macroeconomics.
A business can restructure its liabilities and make its balance sheet look better at the margins. Eventually, though, the market still asks the same question: why did investors demand a higher return from you in the first place?
toebeanteddybears | 9 hours ago
I hope people are recording every single transaction, every rate change, the debt and deficit figures every day under the current administration. Because you know when Democrats get back into power the debt is suddenly going to matter again...
jackieboy1230 | 8 hours ago
We hit 40 trillion in debt, less than a month ago. We’re now 115 more billion in the hole as of sept 9th…. That’s 115 billion spent in what, 30 days? I CANT AFFORD FOOD OR GAS!!! I WORK TWO JOBS, AND THIS FUCKING COUNTRY IS IN A SHIT HOLE. FUCK THIS GOVERNMENT AND FUCK DONALD TRUMP.
ktaktb | 17 hours ago
Being a doomer about the US economy is fun and games.
Then there is a vibe shift.
Where are the economists in the comments explaining that this is no big deal???
When things seemed okay they were kinda annoying but now I need them like a security blanket. This seems "realer" than other problems.
Tell me im wrong
Necessary_Cost_9355 | 16 hours ago
Sorry, this is the kleptocracy playbook. When the USSR collapsed, oligarchs quickly gobbled things up during the fire sale. Every Republican president since Reagan had their own little fire sale after a deregulation crash. Trump is pulling a full Hoover with his tariffs and isolationism, hopeful that he remains the master of the bankruptcy bounce. His ‘friends’ are content to play along that everything is fine for Americans because it’s gauche to cheer on an arsonist while you wait for the fire sale, but the fire sale is what they’re counting on for acquiring tangible assets offset their gamble on the AI bubble.
The crooks have to rob somebody and that somebody is us
vertigo3pc | 16 hours ago
Exactly. JD Vance having a stake in AcreTrader while the US President consistently makes moves to undermine American farmers and push them to bankruptcy is the most nakedly obvious corruption, and it's just another line on the list.
The AI bubble isn't about AI; the government is openly fast tracking data centers with a significant number of GPU's. As AI advances, it will require newer, faster, more complex and more capable GPU's, and that's just 2-3 years away.
The government is pushing for data centers because the government needs GPU compute to use digital currencies as the new reserve currency when the US dollar tanks. They need significant GPU compute for Tether and stablecoins to act as collateral backing the US Dollar. With the GENIUS Act under Trump or the CHIPS Act under Biden, the goal is clear: devalue the US dollar, announce stablecoin integration, watch as the US dollar climbs in value (if it does).
crustyrobots | 15 hours ago
Its been clear to me that these Republican bastards have wanted to collapse our government into something resembling the Kremlin kleptocracy in every detail for a long time.
By "small government" they are being quite literal. Small as in a King, some vassal tech-lords, and then the rest of us.
wormtheology | 17 hours ago
I’ve never understood the “doomer” argument. Pointing out objective fiscal and monetary facts along with analyzing how the US Congress spends money isn’t being a fucking “doomer.” It’s objective reality. Many people just aren’t capable of lateral thinking if they think pointing out the flashing, warning signs is just some sort of hobby.
ktaktb | 17 hours ago
No
The facts are that news, middle, center, and left overstate and overhype minor issues to the point that it is difficult to tell what is actually an emergency or truly ominous.
I am sick of reading articles at face value and getting schooled on the facts which show that x, y, or z that I was worried about because of the article is actually not much changed since 1950 or something like that... it happens all the time.
Think headlines like, home price growth decreased 80% since last month. Like wtf, thanks for finding any way you can to get a big percentage in the headline. It actually just meant that prices increased 1% two months ago and 0.2% last month LOL
That is what im talking about.
NovarKalar | 13 hours ago
Fair. I can see how anyone who isn't well-versed in the dark magics of statistics and percentages might feel like a leaf in a hurricane with all the "articles" that spew forth relentlessly from modern media. I'd advise trying to learn at least the basics of statistical misrepresentation, and ideally also spend quite a bit of effort learning causal logic and methods of critical thinking.
Anyone for whom that requires too much time/effort might be better off disregarding any and all articles containing "%", "per", "average", or any statistics-sounding word in the title. Being ignorant is better than being actively wrong, as uncomfortable as that idea might feel.
vertigo3pc | 16 hours ago
Hypernormalisation was prevalent in the USSR in the 1970's and 1980's, right up until the dissolution of the USSR.
>everyone in the Soviet Union knew the system was failing, but no one could imagine any alternative to the status quo, and politicians and citizens alike were resigned to maintaining the pretense of a functioning society.
1970's and 1980's saw the USSR take on considerable debt to Western banks. Chernobyl was a major disaster that estimates say cost $2 trillion, which further pushed the USSR into financial crisis. Gorbechov and glasnost (transparency) added pressure (whereas the USSR was all about closed doors and trust, glasnost attempted to replace it with transparency), which resulted in the soviet states declaring independence in early 1990/1991.
Now, in America, the 2010's saw considerable growth in big tech, creating a bubble around the future of technology, media consumption, citizen information access, communication, etc. It broke a LOT of the old systems, and now we're seeing the pullback in revenue generation as the companies are bloated amalgamations of smaller companies (Alphabet is Google with other companies; Meta is Facebook and Instagram and others, etc).
Meanwhile, national debt continued to explode, largely pushed into place under Republican leadership (George W Bush, Trump) with modest attempts at budget repair and deficit decreases under Democratic leaders (Obama, Biden). COVID in 2020 added $8 trillion to the national debt, and now we're facing $40 trillion in debt (compared to the US's $24 trillion GDP).
Trump's Administration, like glasnost, is using unprecedented levels of confusion, obstruction, redaction and endless lies to insert opacity to a government previous defined by it's transparency. Add to that a global market that's less and less willing to count on America's ability in (or interest in) paying what it owes, and you have the recipe for USA collapse similar to the USSR.
Hypernormalisation is ending; the world is calling bullshit on the lies Americans and American government have told about themselves for years, and the numbers don't lie. $40 trillion in debt can not be paid back by $24 trillion in GDP, and the current reticence of big tech, American government, and all the companies that were and still are overinflated but losing value daily.
Normally, it's a punditry back-and-forth match where people can make good points and it becomes "We'll see what they do...".
I hope you like which state everyone lives in right now, because by end of 2027, it may be a foreign country to your friends and family in other ~~states~~ countries.
Americans allowed this. Americans voted for it with a bullshit broken voting system that awards the Presidency to the popular vote loser twice in the last 26 years (George W Bush in 2020, and Trump in 2016). Americans did not take to the streets, depose their government, demand change through revolution; so now we all get to suffer the embarrassment of losing our federal government because Americans were convinced that we're the best, we're the smartest, and anything we do is the "right thing."
wormtheology | 11 hours ago
Fantastic comment.
kingofshitmntt | 14 hours ago
Your entire post culminates in a "if we elected democrats everything will be okay" which totally excuses the failings of the democratic party to offer a political program that working class people can get behind. Not excusing the insanity of the republican party here, but the democrats are just as invested in maintaining the corporate political system we have because it rewards their consultancy regime which act as liaisons between the party and the corporate world. Would they have done the insane tariffs or initiated the iran war? probably not, but they certainly wouldn't fix any structural issues with inequality in any meaningful way.
vertigo3pc | 13 hours ago
>"if we elected democrats everything will be okay"
I mentioned Democrats once in my whole reply, and it was the fact that Democrats (Biden and Obama) made tiny reductions in deficit while further pushing the debt-growth policies that further reinforced our national debt.
You're delusional and unserious, I said nothing of the sort about Democrats. You were just desperately sniffing for a "but both sides!" bullshit.
> they certainly wouldn't fix any structural issues with inequality in any meaningful way.
Congratulations, you agree with my post.
Entire_Toe2640 | 15 hours ago
This looks and sounds like a debt death spiral; something a desperate debtor would do to put off the day of reckoning. Is it really any different than check kiting?
Kalorama_Master | 16 hours ago
The market reaction and comments appear to signal that the market doesn’t have faith on the government.
IIRC - Fed credibility is fundamental. I don’t think we ever discussed Treasury credibility in any of my classes.
Here be monsters
Eko1968 | 12 hours ago
Buying with what? Printing money? That is inflationary that will increase the cost of doing business and the cost of servicing that 40 Trillion plus debt. Im not an economist, but an ordinary observer, and even I know it is a knee jerk reaction to a fundamentally flawed system.
Blueskyminer | 9 hours ago
Hard to believe there was a 90% drop in AUM at Key Square Capital Management.
Can't quite put a finger on the common denominator here and there.
wormtheology | 17 hours ago
Scott Bessent is doing this and fiscal necromancy in Japan, the US has a war in Iran, and you guys still think the Fed is going to hike rates as opposed to assisting the US Treasury as much as possible?
lol
crustyrobots | 17 hours ago
Well, maybe or maybe not. Warsh has his back his back to the wall. Whatever he does now will hurt something, somewhere, because that is the state of the system. 25 years of financial insanity is going to have a hard landing now whether they want it or not.
ReturnOfFrank | 14 hours ago
The Fed can do whatever the fuck it wants, but yields are going up, because the bond market smells blood in the water and there's nothing Warsh can do about that.
JPowJunior | 17 hours ago
What’s the alternative?
Heads I win
Tails you lose
wormtheology | 16 hours ago
The alternative was not to start a war with fucking Iran of all powers, and we are WELL past that. Instead of the Fed combating inflation in a calmer macro environment, ie Diesel not skyrocketing, the Fed will basically exercise their discretion and remain “data dependent” meaning nothing will be done. Tightening into Bessent’s nonsense just doesn’t make a single ounce of sense for Warsh.
Warsh should be hiking every single meeting, but how does that help the US Treasury?
crustyrobots | 15 hours ago
They've created a financial paradox there is no escape from now. The debt is too large and we can't just fix 50 years of bad policy and fiscal insanity in a week. Doing what is good for the Treasury is bad for the Fed, and doing what is good for the Fed screws the Treasury.
$40 Trillion is about to land on their faces and start wiggling.
thomasthetanker | 16 hours ago
Can't US and Japan just change sides? Japan raise their rates to more than the US. And US drops to near zero as per Trumps request. The new carry trade is selling dollars (also boosts Trumps cheaper manufacture dream) to buy yen. The cycle continues just the players have swapped position.
Surprise_Special | 14 hours ago
With printed money! Maybe the Trump administration needs to balance the budget like he said he would do. At least stop spending money on a illegal war.
Shooresy | 10 hours ago
Thank goodness, it’s high time we had more fiscal responsibility and take this situation seriously.
That ought to cover… 0.015% of the national debt.
yangstyle | 15 hours ago
So, someone ELI5: I am well versed in economics but not in the bond market. If I understand correctly, buying back $6 billion in long term bonds should increase yields because there is less debt on the market, right?
But I don't think I'm understanding this. I don't see how buying back debt is a strategy for...what?
Also, what effect does the bond market have on the general economy?
cabo_jose | 14 hours ago
buying a bond is a loan to the govt which you make back with interest. when people aren’t willing to buy bonds, in this case the US government, they have to raise the rate of interest to entice buyers. meanwhile, the govt pays interest on their accumulated debt, and it’s gotten so bad that they are doing anything to make some cash i.e. sell more bonds by offering higher bond yield rates.
if you see the 10 yr government bond return climb higher, it means the government has a harder time convincing buyers it is a sound investment.
yangstyle | 14 hours ago
OK. Thanks for this. My follow up question is the general effect of this on the economy. I'm not sure I see what the impact would be on the macroeconomy.
If the long term bond yields rise, it's not necessarily going to affect business or consumer borrowing costs. The worst impact I see is a larger percentage of GDP going to pay off debt. Today's action of buying back $6 billion in debt should have freed up some credit for the US and send bond yields lower, no? Are we saying that, even repaying $6 billion in debt immediately is not making US credit look any better to the bond market? Then the market is seeing risks outside of just the "balance sheet"?
The economic fundamentals say one thing but the political risk says something else and the political risk in the long term has to do with more than money. So, the bold yields are up because they don't see the US as such a safe investment in the long term. Is this correct?
OK...I think I talked myself through it. Thanks for your help.
Dave_The_Dude | 13 hours ago
They are using short term treasury bills with a lower interest rate to buy back 10 and 20 year bonds.
Basically using Visa to pay off MasterCard. Investors get concerned when the Treasury is trying to lower long bond yields this way.
cabo_jose | 13 hours ago
the mortgage interest rate is correlated to the bond rate so it does affect borrowing. for example, why would a bank give you a 3% mortgage when they can get a 4% return from a govt bond?
The US government overspends its federal budget every year and the make the difference up by selling bonds to China, Japan, Canada, etc. And when their balance sheets are already loaded up on US treasury bonds, then they aren’t looking to buy more hence why bond rates can continue to rise.
the effect on the economy is we’re forced to cut back on federal spending which would kill the economy because the US government is the largest employer, or default on the debt which tbh I don’t even know what happens then… we allow countries to take assets as collateral? not to mention all this is happening in an inflationary environment
Double-treble-nc14 | 10 hours ago
Honest question about this- where is the money coming from to buy back the debt? Don’t they just have to borrow more money to buy back those bonds? Who would be fooled by that shell game?
A_Credo | 10 hours ago
That is literally what is happening. They are selling short dated treasuries to buy long dated treasuries.
lunchbox_tragedy | 8 hours ago
Using the credit card to pay the mortgage…got it
flip6threeh0le | 3 hours ago
So the money is coming from the treasury general fund. It’s the treasury’s checking account basically. Taxes in. Expenses out.
This replacing of bonds close to maturity is actually fairly normal. Bonds close to maturity are hard to trade. And you want a liquid bond market. So yeah the treasury has been doing this for a bit. It’s not exactly paying the mortgage with a credit card.
What’s new is the scale at which this treasury is doing it. Long term yields are spiking because of our propensity to borrow into oblivion and this buying is pretty clearly an attempt at price manipulation
Decent-Box-1859 | 8 hours ago
So they anticipate interest rates to be higher for longer? Otherwise, they'd buy shorter term bills. I wouldn't be surprised inflation remains a problem for the next 10 years.
Xeynon | 5 hours ago
I see we've reached the "kiting checks and using one credit card to pay off another" stage of the con.
It'll be very hard for Trump to be removed from office because the barrier is so high in the US system but he's gunning to become the American Liz Truss.
DarthJDP | 14 hours ago
needs a few more zeros for this to have any meaningful effect, 600 billion would be a start. 6 trillion might be whats needed.
Words Words Words Words Words Words Words Words Words Words Words Words Words Words Words Words Wor Words Words Words ds Words Words Words Words Words Words Words Words Words WordsWords Wor ds WordsWords Words Words Words Words Words
User299651 | 15 hours ago
Noob question. Why have we seen all these economic depression level articles and doom and gloom in the comments but things keep trucking along just fine?
Liberation dau tariffs, oil crisis from the war, circular trading/AI bubble, now this. Is this just another nothing burger that seems like a big deal but nothing will actually come of it?
Bring on the damn crash already if there is to be one. I’m sick of hearing about the sky falling for the thousandth time since fall of 2024.
crustyrobots | 13 hours ago
Its always slow until it isn't. Collapse is a process, not a singular event