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Bessent’s move to tamp down rising rates backfires, as bond yields jump and stocks tumble — The 10-year bond yield surged to as high as 4.85%, its highest level since November 2023
I hope if another administration ever gets in, they go after these idiots financially as they are definitely skimming or blatantly stealing money. I hope these crooks get squeezed for every penny.
Our problem is that people equate minor crimes with country-destroying crimes. I agree there are bad apples everywhere, but some are easy to fix, while others kill the tree along with them. “Both sides…” I cringe every time hear this when people use crime to justify crime.
Just an interesting observation. Prior to the 2016 election, a major talking point on the right was how corrupt the left was at profiting from their roles. Now the shoe is on the other foot, and its odd people assume anything will change in a rich man game with just a party flip.
Bookend excerpts from article by Steve Kopack updated Sept. 9, 2026, 4:15 PM EDT:
Bonds sharply sold off and stocks tumbled Wednesday after Treasury Secretary Scott Bessent’s latest effort to tamp down what he called market “fever” backfired.
At 11 a.m. ET, the Treasury Department announced that it would repurchase $6 billion worth of 10- to 20-year government bonds, in the hopes that fewer bonds on the market would drive up demand, pushing down rates, or yields, that have soared to levels not seen in decades.
But that’s not what happened. Instead, most Treasury yields sharply jumped on the announcement. The 10-year bond yield surged to as high as 4.85%, its highest level since November 2023. The 20- and 30-year bond yields surged to as high as 5.3%. When Treasuries fall, their yields rise.
By 4p.m. ET, bond yields had pulled back slightly from the highest levels of the day but remained sharply elevated.
The Nasdaq Composite, which is sensitive to interest rates given the high number of major tech companies it tracks, ended the day down 0.6%. The S&P 500 tumbled 0.5%.
The reaction from Wall Street underscores the limits of the power Bessent claims to exert over markets. It also comes as the Trump administration is running out of tools to gain leverage over major parts of the U.S. economy, from gas prices and bond yields to retaliatory tariffs.
Yields have been rising steadily since the start of the year. But they began to surge in late July, when President Donald Trump’s newly-installed Federal Reserve chairman, Kevin Warsh, held a press conference at which he didn’t sound fully committed to using the Fed’s tools to help curb inflation.
[...] Wednesday’s Treasury buyback announcement was only the latest in a series of active interventions Bessent has taken in the markets recently.
In early August, Treasury helped to prop up the Japanese yen.
Bessent’s unusual role in helping the Japanese government support the yen was prompted by worries that the island nation — one of the largest holders of U.S. Treasury bonds — might choose to sell some of its holdings in order to raise cash to support its currency.
Sales of a large volume of Treasury bonds typically push yields higher. By assisting Japan in stabilizing its currency, the White House was effectively guarding against a potentially large sale of T-bills.
Earlier this week, Bessent warned currency traders not to test his resolve.
“I am the house now,” Bessent said at SMU. “So when we intervene with the Japanese yen, I have pretty good insight into what the Japanese, what the Bank of Japan is going to do, what Japanese policymakers are going to do.”
Where’s the money going? Capex or into pockets via dividends. Same for stocks or their underlying corporate interests. It’s been a MONSTER build to fortify the asset valuations of companies and their stocks, since 2023. Data centers figure into this, equal parts asset protection/surveillance/automation.
Money into pockets generally goes somewhere, either the banking system, money market funds, bonds or equities. It's rare that someone would stash cash away.
Money market funds, eh? Well, money market funds are loaded up with 4-week Treasury bills, which is exactly what Bessant is selling in order to buy the long-term bonds.
Yep. It’s going to spiral out of control if they do too much at once, thus the relatively small figures this asshat is proclaiming in public announcements.
"Rare" might depend heavily on your world view and what you know. If you're a legal citizen or green card holder, with a college degree or decent level of education, and work white collar a job where you have the leeway to be on reddit during the workday? Sure. Everything goes through payroll, automatically goes into your legally approved bank/brokerage, post-tax funds gets either auto rolled into investment or spent, etc.
Less "rare" if say you are illegal immigrants, pseudo-legal or grey zone on immigration, doing illegal things like selling drugs or doing adult work, bottom end tip wage earners, and/or are a powerful politician/billionaire who is largely unhindered by borders/laws/audits. It's more like they'll have a job/business/hustle/gig where they make money or get paid cash/crypto. Cash can be held or put into jewelry, gold, silver, crypto like monero, fine wine/art, collectables, PM coinage, off-shore shadow businesses, Swiss/HK/Moldovan/other bank accounts, etc. Those things are less appealing when you get your paycheck post-payroll and it is auto-enrolled to by your 401K to buy VOO every month. Much more appealing if you're gardener, maid, or dishwasher with questionable legal status getting paid cash under the table.
Banks would shorten their balance sheets as fewer persons and firms borrow at higher interest rates. They may attract more savings and deposits, but this is parked at central banks and in money markets that offer high-enough interest rates to cover the interest cost on deposits and savings, which will therefore remain low. As bank's balance sheets shorten, M2 falls (or its growth remains below nominal GDP growth). The money, in this sense, 'disappears'.
It is going overseas or going into corporate bonds. The big tech companies all released their own "bonds" to pay for the AI build out. It is directly competing with US bonds. Not only that, other foreign markets are looking more stable.
People forget there is a whole world outside of the USA. The korean stock market is still absorbing a lot of foreign funding too and is unbelievably profitable....KOSPI is literally leaving the S&P in the dust....at a 70% gain since the beginning of the year.....
Why doesn’t Trump just slap the bonds with tariffs? He could use the revenue to buy more bonds! Or at least that’s what I assume is next because we are in the stupidest timeline
That is actually not the worst idea? 100% 30y bonds is terrible, ofc. But if gov workers start getting 10% of their pay in a combination of short and long term gov debt there may be something to it. I would consider it if I were a gov employee and this was an option. Depending on the tax implications.
Bessent is the guy that has learned techniques and methods of financial manipulation, but doesn’t understand the underlying concepts that make these things effective.
It’s like he knows how to use a wrench to turn a bolt, but he doesn’t know why he is using the wrench, or how tight to tighten the bolt. He also doesn’t understand that although he can use a wrench to tight a screw, it won’t be as good as using a screwdriver. Also he hasn’t figured out that a wrench can’t tighten a nail. But maybe he will try hammering the nail with the wrench. Hopefully he doesn’t bust his index finger.
> the Treasury Department announced that it would repurchase $6 billion worth of 10- to 20-year government bonds, in the hopes that fewer bonds on the market would drive up demand, pushing down yields. Instead, most Treasury yields sharply jumped on the announcement.
"i thought that dicking around with he bond market instead of addressing underlying concerns would inspire confidence, who knew this could be so complicated"
Perhaps Bessent needs to spend less time taking cheap shots at Canada and more time doing his job. This guy is a piss poor Treasury Secretary is in way over his head. 10 year treasuries are getting close to junk bond status.
Sadly everyone has to pay for the irresponsibility of our government officials/politicians. Both sides but definitely Trump & Co.
Bessent is worried about the 10y because treasury is already trying to move debt from further out (20/30yr) to the short end of the curve. All the while putting more pressure on the Fed to not hike to tamper inflation. Higher long end yields mean the long debt or mortgages will cost more. The US will continue to have issues with our debt, deficits, inflation, balancing the budget, and feeling the desire to enact forms of yield curve control in the face of fiscal dominance.
Higher mortgages, higher interest rates, short term borrowing costs, higher energy prices, more inflation overall, etcetcetc. So expect more of the same lies about being able to overpower the bond market, lies about the war being over soon, lies about inflation being under control or falling soon, etcetcetc.
But doing the same thing expecting different results is insanity to it's better to idiot proof your life as much as possible (impossible to fully proof everything, but it's better than doing nothing).
Bessent has no real options. Congress has fucked the budget. He can't rein in Trump on tariffs or Iran. Republican economic policy is just completely unworkable.
Bessent could start by not antagonising with put downs and cheap shots his bond holders. Japan, China, Canada and the EU hold a lot of US bonds (debt) they don't have too.
It’s entirely about short term political points with the base. The whole administration follows the same playbook. They don’t care about the long term consequences of anything.
Exactly, Trump will be ranting about interest rates and Bessent will be stuttering about how he's going to get them down. I'm surprised he has lasted this long really, he's probably throwing around the bond vigilante thing a bit and blaming socialists and Canada.
“Look here’s the thing. We have delivered the greatest lunch in American history. If your criteria is whether you had food then you’re looking at the wrong data points. We’ve seen what happens in Canada when people eat lunch. It’s leading directly to communism.”
In the bond markets he certainly is just a yippy little dog. The trading volume is 1,200 billion dollars per day, and he thought 6 billion was going to swing the markets? He is delusional and so are his advisors (all rabid Maga types like him). They probably believe their own bullshit.
These fucking losers are literally the failed son stereotype who walk around town shouting at the hostess "DON'T YOU KNOW WHO MY FATHER IS?" and the hostess goes "Sir, this is Wendy's".
« Let me tell you a little story about a German shepherd dog I had. There was this tiny dog that kept barking at the gsd every day, then one day the gsd had had enough and put that tiny dog in its place. »
So Bessent was the little dog in his story and the gsd was the bond market. Got it.
Hes another fucking retard failing upward just like Trump. He ran more than one big fund into the ground (at least it was Soros' money) before his tenure as the worst Treasury Sec in recorded history
If this was happening in 2007 before our 24/7 deluge of social media induced rapid fire news slop, this would be all that the financial news was talking about, warning of an impending recession and market collapse.
But social media has destroyed any semblance of a shared reality and shared concern (or the ability to focus on one thing) among the media class or the people, so this is like number 9 on a list of 10 'scandals' that happened since the month started.
Who wants to own long term bonds for a 5% yearly interest return when their price is dropping daily like today. Even within a few days, one can lose more than 5% on holding these treasuries.
So the price dropping would actually be a good reason to buy if you intend to collect the yield.
The yield has been rising pretty steadily since February 28th (wonder why?)
So if you can gain access to that yield for a lower price, all the better.
But like I said, that interest rate is essentially a risk premium. The fact that it's going up means the bond market sees more risk than it used to.
And it actually makes sense that as the yield (risk premium) goes up, the sticker price of the treasury goes down, as those who are already holding them look to sell.
So the price only matters if you intend to trade the bond later, if all you want to do is collect the yield, the low price is not such a bad thing.
Yeah, that's what I meant. Obviously if one buys a bond that is halfway to maturity you get fewer interest payments. But you'd also expect to pay less for a bond that is half matured already also. So the exact yield kinda depends on the conditions at the time.
> you'd also expect to pay less for a bond that is half matured already also
would you? if you could buy a new 5-year bond with 4% interest or an old 10-year bond at 4% interest with 5 years left, why would you pay more for one vs the other?
Liquidity, for one. One type of bond may be available in greater quantity than another and thus just more liquid if that is important to the buyer.
Traders do tend to favor newly issued bonds a bit more too, even if mathematically the returns should be the same, though having the same interest rate today as 5 years ago is basically just coincidence unless your central bankers are determined to keep a tight leash on it regardless of consequences.
But the reason people trade bonds isn't just because of the interest rate today, it's because of the interest rates from the past and anticipated rates in the future.
If your plan is to just buy new bonds and sit on them to maturity, you can just buy what is available when you like and sit.
But if your intention is to trade, you're betting on movements in interest rates. If interest rates go up, the value of old bonds goes down. If interest rates go down, those old bonds become more attractive.
I think he knows we're in a bad spot and he's hoping the bond market will sympathize. For the last twenty years of Fed intervention the question was, "where are the bond vigilantes?" as market manipulation reigned. They're back!
As I commented earlier. This shows a clear lack of confidence and credibility. Trump, with his “trolling” and other shenanigans, may be able to keep his core base happy and entertained, but the markets cannot ignore reality.
A similar phenomenon can be seen with the Strait of Hormuz. He’s telling his base that we are in the driver’s seat and the regime’s collapse is imminent. The base believes this to be true. However, insurance premiums tell a different story.
So what happens when leadership is divorced with reality? Well, I can only recall banana republics going through this, resulting in hyperinflation. I can’t recall a similar situation with a developed economy.
I mean…may God have mercy on us. The ONLY way out is higher taxes and lower spending. However, neither party is down with this
Republicans are not able to govern, but they also can prevent others from governing by destroying the economy so there’s nothing to govern. Truly a rock and a hard place
Liz Truss showed nicely that markets are all about trust. The more these idiots intervene to show there is nothing going on, the more markets understand it stinks.
That’s the beauty of unsustainable trends in economics, eventually reality sets in. So while the MAGA base happily eats up the tall tales and AI imagery, reality will eventually come knocking
I mean with debt levels what they are and the cashflow required to service said debts there better be less confidence in the ability to adequately service those debts. I realize it's more complicated than that with bond markets but I mean come on, leveraging yourself like that is just crazy and there should be a lack of confidence in whoever does that.
The fools still think this is the 80s when other countries couldn't hit us back. Clearly that is not true and has not been for decades.
Theyre dumbass bullying and market games failed to impress these other countries, and now we shall pay the price for our collective hubris in thinking we were so untouchable. The rest of the world has been looking for an excuse to start removing the US from them finally, and now its a matter of survival to do that.
That’s not the only out. The other one is high rates and high inflation. Spending on debt reserving will crowd out other aspects of government spending so services will get poorer. While inflation wreaks havoc on the populace but decreases our debt load.
It’s the realistic path forward so prepare for it. Own scarce assets. Develop skills that command a premium so that your salary keeps up with inflation. It’s going to suck but if you’re smart you can make it work for you
Someone said it brilliantly elswehwere: Bessent is smart enough to know that this was all bullshit and likely a bad signal to the market. But he has completely imbibed the hubris and sychophancy of the Trump court.
I'm not great at economics, but all of this feels like the super powerful elite insiders gaming the system to reap the benefits at historic levels while everybody else gets fucked, then somehow blame democrats when the base notices something even more wrong than current conditions two years from now, run on it, promise to fix it, get back into power and keep doing this.
Agreed and yet the rest of the world still wants the US to fail spectacularly. Why? Because it seems like the most likely path towards a return to some level of normalcy at least eventually.
These maneuvers do nothing about the debt. Issuing short term T bills to finance these buy backs will end in a disaster if they ever raise rates. The constant rollovers and return to auction (probably every 4 to 52 weeks) will crush them if rates move up even a little bit. They will have to keep issuing new T bills to pay off maturing ones at higher interest rates. For these reasons I don’t think a rate hike will happen next week.
Can I get a short history lesson here? What happened in 2023 to avoid catastrophe? Was it something the market naturally dealt with or did the US gov do something in particular to try ease this? Because I don’t recall anybody being very up in arms about this 3 years ago… seemed like business as usual.
bacon-squared | a day ago
I hope if another administration ever gets in, they go after these idiots financially as they are definitely skimming or blatantly stealing money. I hope these crooks get squeezed for every penny.
SpitefulSeagull | a day ago
They should all be in prison
gethereddout | a day ago
The worst of the worst are running things
Visible_Wolverine2 | a day ago
They won’t.
sgtbackpain03 | 17 hours ago
Don't worry, the American justice system is on the case, and just look at their track record at prosecuting rich people.
Educational_Bus8810 | a day ago
One problem is both parties are cashing in. This administration just is doing it so blantely, that is seems normal.
Fast-Possible1288 | a day ago
Nah they are not the same, unprecedented and orders of magnitude different levels of cashing in happening.
VeryGenericD | a day ago
Our problem is that people equate minor crimes with country-destroying crimes. I agree there are bad apples everywhere, but some are easy to fix, while others kill the tree along with them. “Both sides…” I cringe every time hear this when people use crime to justify crime.
BrittanyBrie | a day ago
Just an interesting observation. Prior to the 2016 election, a major talking point on the right was how corrupt the left was at profiting from their roles. Now the shoe is on the other foot, and its odd people assume anything will change in a rich man game with just a party flip.
DreamedDoughnut | a day ago
DSA is picking up so who knows
BrittanyBrie | a day ago
The new flavor of the month it seems. Wonder what movement 5 years from now will be the new sexy thing.
DreamedDoughnut | a day ago
Considering it’s been the same slop for 2 decades im pretty excited
BrittanyBrie | a day ago
Honestly, why not at this point. AI is proving scarcity to be a bit unknown in the labor market, and thats a good thing for collective systems.
jarredknowledge | a day ago
This is the beauty of the system. “No blame them”
[OP] marketrent | a day ago
Bookend excerpts from article by Steve Kopack updated Sept. 9, 2026, 4:15 PM EDT:
Bonds sharply sold off and stocks tumbled Wednesday after Treasury Secretary Scott Bessent’s latest effort to tamp down what he called market “fever” backfired.
At 11 a.m. ET, the Treasury Department announced that it would repurchase $6 billion worth of 10- to 20-year government bonds, in the hopes that fewer bonds on the market would drive up demand, pushing down rates, or yields, that have soared to levels not seen in decades.
But that’s not what happened. Instead, most Treasury yields sharply jumped on the announcement. The 10-year bond yield surged to as high as 4.85%, its highest level since November 2023. The 20- and 30-year bond yields surged to as high as 5.3%. When Treasuries fall, their yields rise.
By 4p.m. ET, bond yields had pulled back slightly from the highest levels of the day but remained sharply elevated.
The Nasdaq Composite, which is sensitive to interest rates given the high number of major tech companies it tracks, ended the day down 0.6%. The S&P 500 tumbled 0.5%.
The reaction from Wall Street underscores the limits of the power Bessent claims to exert over markets. It also comes as the Trump administration is running out of tools to gain leverage over major parts of the U.S. economy, from gas prices and bond yields to retaliatory tariffs.
Yields have been rising steadily since the start of the year. But they began to surge in late July, when President Donald Trump’s newly-installed Federal Reserve chairman, Kevin Warsh, held a press conference at which he didn’t sound fully committed to using the Fed’s tools to help curb inflation.
[...] Wednesday’s Treasury buyback announcement was only the latest in a series of active interventions Bessent has taken in the markets recently.
In early August, Treasury helped to prop up the Japanese yen.
Bessent’s unusual role in helping the Japanese government support the yen was prompted by worries that the island nation — one of the largest holders of U.S. Treasury bonds — might choose to sell some of its holdings in order to raise cash to support its currency.
Sales of a large volume of Treasury bonds typically push yields higher. By assisting Japan in stabilizing its currency, the White House was effectively guarding against a potentially large sale of T-bills.
Earlier this week, Bessent warned currency traders not to test his resolve.
“I am the house now,” Bessent said at SMU. “So when we intervene with the Japanese yen, I have pretty good insight into what the Japanese, what the Bank of Japan is going to do, what Japanese policymakers are going to do.”
“You can bet against me if you want,” he said.
a_library_socialist | a day ago
So if the money isn't going to bonds, where is it going? Gold isn't moving either, I don't think indexes are either?
082426grateful | a day ago
Where’s the money going? Capex or into pockets via dividends. Same for stocks or their underlying corporate interests. It’s been a MONSTER build to fortify the asset valuations of companies and their stocks, since 2023. Data centers figure into this, equal parts asset protection/surveillance/automation.
Affectionate-Panic-1 | a day ago
Money into pockets generally goes somewhere, either the banking system, money market funds, bonds or equities. It's rare that someone would stash cash away.
vinyl1earthlink | a day ago
Money market funds, eh? Well, money market funds are loaded up with 4-week Treasury bills, which is exactly what Bessant is selling in order to buy the long-term bonds.
082426grateful | a day ago
Yep. It’s going to spiral out of control if they do too much at once, thus the relatively small figures this asshat is proclaiming in public announcements.
zxc123zxc123 | a day ago
"Rare" might depend heavily on your world view and what you know. If you're a legal citizen or green card holder, with a college degree or decent level of education, and work white collar a job where you have the leeway to be on reddit during the workday? Sure. Everything goes through payroll, automatically goes into your legally approved bank/brokerage, post-tax funds gets either auto rolled into investment or spent, etc.
Less "rare" if say you are illegal immigrants, pseudo-legal or grey zone on immigration, doing illegal things like selling drugs or doing adult work, bottom end tip wage earners, and/or are a powerful politician/billionaire who is largely unhindered by borders/laws/audits. It's more like they'll have a job/business/hustle/gig where they make money or get paid cash/crypto. Cash can be held or put into jewelry, gold, silver, crypto like monero, fine wine/art, collectables, PM coinage, off-shore shadow businesses, Swiss/HK/Moldovan/other bank accounts, etc. Those things are less appealing when you get your paycheck post-payroll and it is auto-enrolled to by your 401K to buy VOO every month. Much more appealing if you're gardener, maid, or dishwasher with questionable legal status getting paid cash under the table.
legbreaker | a day ago
Some is just rotating from 10 and 30 year long term into short term treasuries.
Some is going into the high yield AI bonds.
Much is being repatriated to Japan or China.
NotABigFanOfAnything | a day ago
Banks would shorten their balance sheets as fewer persons and firms borrow at higher interest rates. They may attract more savings and deposits, but this is parked at central banks and in money markets that offer high-enough interest rates to cover the interest cost on deposits and savings, which will therefore remain low. As bank's balance sheets shorten, M2 falls (or its growth remains below nominal GDP growth). The money, in this sense, 'disappears'.
CauliflowerDaffodil | a day ago
Short-term T-bills held solid and commodities like metals and oil were up. All major precious metals showed gains today.
sonofalando | a day ago
All wealth is being eroded. The store of value is low interest debt right now.
PrinnyFriend | a day ago
It is going overseas or going into corporate bonds. The big tech companies all released their own "bonds" to pay for the AI build out. It is directly competing with US bonds. Not only that, other foreign markets are looking more stable.
People forget there is a whole world outside of the USA. The korean stock market is still absorbing a lot of foreign funding too and is unbelievably profitable....KOSPI is literally leaving the S&P in the dust....at a 70% gain since the beginning of the year.....
Affectionate-Panic-1 | a day ago
Equities are pretty high.
Fuddle | a day ago
Why doesn’t Trump just slap the bonds with tariffs? He could use the revenue to buy more bonds! Or at least that’s what I assume is next because we are in the stupidest timeline
oldschoolology | a day ago
Trump and KegsBreath are busy readying the world greatest military to attack the bond market.
IPv6forDogecoin | a day ago
When I heard that I assumed they were going to pay soldiers in 30 year bonds
Imelia29 | a day ago
That is actually not the worst idea? 100% 30y bonds is terrible, ofc. But if gov workers start getting 10% of their pay in a combination of short and long term gov debt there may be something to it. I would consider it if I were a gov employee and this was an option. Depending on the tax implications.
YoghurtHistorical527 | a day ago
Don't give him any ideas!
BadmiralHarryKim | a day ago
Rename Treasury Bills to American Bills!
Problem solved.
evanwilliams212 | a day ago
These dummies have actually discussed a version of this.
dust4ngel | a day ago
he could drop a nuke on the bonds - it worked for hurricanes.
zeroman987 | a day ago
Bessent is the guy that has learned techniques and methods of financial manipulation, but doesn’t understand the underlying concepts that make these things effective.
It’s like he knows how to use a wrench to turn a bolt, but he doesn’t know why he is using the wrench, or how tight to tighten the bolt. He also doesn’t understand that although he can use a wrench to tight a screw, it won’t be as good as using a screwdriver. Also he hasn’t figured out that a wrench can’t tighten a nail. But maybe he will try hammering the nail with the wrench. Hopefully he doesn’t bust his index finger.
ButtStopsHere | a day ago
And his boss's favorite tool is a blowtorch.
dust4ngel | a day ago
> the Treasury Department announced that it would repurchase $6 billion worth of 10- to 20-year government bonds, in the hopes that fewer bonds on the market would drive up demand, pushing down yields. Instead, most Treasury yields sharply jumped on the announcement.
"i thought that dicking around with he bond market instead of addressing underlying concerns would inspire confidence, who knew this could be so complicated"
ICLazeru | a day ago
A Soros trader is now on the opposite side of the fence of a Soros trade.
You'd think he'd know better.
Iirc he holds Druckenmiller in high regard, and Druckenmiller thinks Bessent is full of $h*t.
IntroductionOk9280 | a day ago
Perhaps Bessent needs to spend less time taking cheap shots at Canada and more time doing his job. This guy is a piss poor Treasury Secretary is in way over his head. 10 year treasuries are getting close to junk bond status.
[OP] marketrent | a day ago
Moron risk premium.
zxc123zxc123 | a day ago
Sadly everyone has to pay for the irresponsibility of our government officials/politicians. Both sides but definitely Trump & Co.
Bessent is worried about the 10y because treasury is already trying to move debt from further out (20/30yr) to the short end of the curve. All the while putting more pressure on the Fed to not hike to tamper inflation. Higher long end yields mean the long debt or mortgages will cost more. The US will continue to have issues with our debt, deficits, inflation, balancing the budget, and feeling the desire to enact forms of yield curve control in the face of fiscal dominance.
Higher mortgages, higher interest rates, short term borrowing costs, higher energy prices, more inflation overall, etcetcetc. So expect more of the same lies about being able to overpower the bond market, lies about the war being over soon, lies about inflation being under control or falling soon, etcetcetc.
But doing the same thing expecting different results is insanity to it's better to idiot proof your life as much as possible (impossible to fully proof everything, but it's better than doing nothing).
handsoapdispenser | a day ago
Bessent has no real options. Congress has fucked the budget. He can't rein in Trump on tariffs or Iran. Republican economic policy is just completely unworkable.
IntroductionOk9280 | a day ago
Bessent could start by not antagonising with put downs and cheap shots his bond holders. Japan, China, Canada and the EU hold a lot of US bonds (debt) they don't have too.
TootCannon | a day ago
It’s entirely about short term political points with the base. The whole administration follows the same playbook. They don’t care about the long term consequences of anything.
Leopold_Darkworth | a day ago
If he says or does anything contrary to Trump's ignorant bloviating, he'll be fired and replaced with an obedient Acting Lackey.
boofles1 | a day ago
Exactly, Trump will be ranting about interest rates and Bessent will be stuttering about how he's going to get them down. I'm surprised he has lasted this long really, he's probably throwing around the bond vigilante thing a bit and blaming socialists and Canada.
bjdevar25 | a day ago
Congress? Seems his boss signed the bills...
Lemp_Triscuit11 | 21 hours ago
Republican economic policy is putting America's money directly into Trump and God knows how many other peoples pockets
Brave_Yesterday_6106 | a day ago
He's probably going to abruptly resign to focus more on his family.
Murder_Bird_ | a day ago
Feel sorry for them if he does.
Upstairs_Baby8424 | a day ago
“Daddy we didn’t get any lunch today.”
“Look here’s the thing. We have delivered the greatest lunch in American history. If your criteria is whether you had food then you’re looking at the wrong data points. We’ve seen what happens in Canada when people eat lunch. It’s leading directly to communism.”
SandIntelligent247 | a day ago
Normally they do that after they realize Daddy Trump doesn’t tell them a terrorist attack targeting them is incoming. Like with pam bondi.
Pale_Leek2994 | a day ago
The guy who bankrupted a hedge fund is no good with money? I’m shocked.
a_case_of_everything | a day ago
Almost like Bessent is the yippy little dog after all...
CallmeishmaelSancho | a day ago
In the bond markets he certainly is just a yippy little dog. The trading volume is 1,200 billion dollars per day, and he thought 6 billion was going to swing the markets? He is delusional and so are his advisors (all rabid Maga types like him). They probably believe their own bullshit.
Wild-Style5857 | a day ago
Bessent certainly doesn't sound/look like he believes anything he saying.
big-papito | a day ago
These fucking losers are literally the failed son stereotype who walk around town shouting at the hostess "DON'T YOU KNOW WHO MY FATHER IS?" and the hostess goes "Sir, this is Wendy's".
LetMeSeeYourNumber | a day ago
i thought this was America
Jaydee888 | a day ago
« Let me tell you a little story about a German shepherd dog I had. There was this tiny dog that kept barking at the gsd every day, then one day the gsd had had enough and put that tiny dog in its place. »
So Bessent was the little dog in his story and the gsd was the bond market. Got it.
kextatic | a day ago
The thing no one says out loud is that USA is cooked.
crustyrobots | a day ago
Hes another fucking retard failing upward just like Trump. He ran more than one big fund into the ground (at least it was Soros' money) before his tenure as the worst Treasury Sec in recorded history
artbystorms | a day ago
If this was happening in 2007 before our 24/7 deluge of social media induced rapid fire news slop, this would be all that the financial news was talking about, warning of an impending recession and market collapse.
But social media has destroyed any semblance of a shared reality and shared concern (or the ability to focus on one thing) among the media class or the people, so this is like number 9 on a list of 10 'scandals' that happened since the month started.
ICLazeru | a day ago
I think the bond market is looking at his enhanced buybacks as concerning sign in themselves.
That concern is translating to higher interest rates as a risk premium.
This happening while stocks slip, meaning that even the weak stock markets these last few days hasn't rattled up greater demand for bonds.
Add in that the Fed is probably not going to drop rates.
Basically, I think the bond market is sending no confidence signals to Bessent and he's trying desperately not to hear them.
coalescence2071 | a day ago
Who wants to own long term bonds for a 5% yearly interest return when their price is dropping daily like today. Even within a few days, one can lose more than 5% on holding these treasuries.
ICLazeru | a day ago
So the price dropping would actually be a good reason to buy if you intend to collect the yield.
The yield has been rising pretty steadily since February 28th (wonder why?)
So if you can gain access to that yield for a lower price, all the better.
But like I said, that interest rate is essentially a risk premium. The fact that it's going up means the bond market sees more risk than it used to.
And it actually makes sense that as the yield (risk premium) goes up, the sticker price of the treasury goes down, as those who are already holding them look to sell.
So the price only matters if you intend to trade the bond later, if all you want to do is collect the yield, the low price is not such a bad thing.
blade-runner_1982 | a day ago
It doesn't only actually make sense.
Sticker price always goes down when yields go up.
dust4ngel | a day ago
> if you can gain access to that yield for a lower price, all the better
yield is interest over price - do you mean interest?
ICLazeru | a day ago
Yeah, that's what I meant. Obviously if one buys a bond that is halfway to maturity you get fewer interest payments. But you'd also expect to pay less for a bond that is half matured already also. So the exact yield kinda depends on the conditions at the time.
dust4ngel | a day ago
> you'd also expect to pay less for a bond that is half matured already also
would you? if you could buy a new 5-year bond with 4% interest or an old 10-year bond at 4% interest with 5 years left, why would you pay more for one vs the other?
ICLazeru | a day ago
Liquidity, for one. One type of bond may be available in greater quantity than another and thus just more liquid if that is important to the buyer.
Traders do tend to favor newly issued bonds a bit more too, even if mathematically the returns should be the same, though having the same interest rate today as 5 years ago is basically just coincidence unless your central bankers are determined to keep a tight leash on it regardless of consequences.
But the reason people trade bonds isn't just because of the interest rate today, it's because of the interest rates from the past and anticipated rates in the future.
If your plan is to just buy new bonds and sit on them to maturity, you can just buy what is available when you like and sit.
But if your intention is to trade, you're betting on movements in interest rates. If interest rates go up, the value of old bonds goes down. If interest rates go down, those old bonds become more attractive.
rainbikr | 21 hours ago
I think he knows we're in a bad spot and he's hoping the bond market will sympathize. For the last twenty years of Fed intervention the question was, "where are the bond vigilantes?" as market manipulation reigned. They're back!
Kalorama_Master | a day ago
As I commented earlier. This shows a clear lack of confidence and credibility. Trump, with his “trolling” and other shenanigans, may be able to keep his core base happy and entertained, but the markets cannot ignore reality.
A similar phenomenon can be seen with the Strait of Hormuz. He’s telling his base that we are in the driver’s seat and the regime’s collapse is imminent. The base believes this to be true. However, insurance premiums tell a different story.
So what happens when leadership is divorced with reality? Well, I can only recall banana republics going through this, resulting in hyperinflation. I can’t recall a similar situation with a developed economy.
I mean…may God have mercy on us. The ONLY way out is higher taxes and lower spending. However, neither party is down with this
WellHung67 | a day ago
Republicans are not able to govern, but they also can prevent others from governing by destroying the economy so there’s nothing to govern. Truly a rock and a hard place
dadofadisaster | a day ago
You forgot about their third option, taking so many vacations there’s no time to deliberate about governing
crustyrobots | a day ago
They dont want to govern. They want to rule
Agreeable-Mixture947 | a day ago
Liz Truss showed nicely that markets are all about trust. The more these idiots intervene to show there is nothing going on, the more markets understand it stinks.
makemeking706 | a day ago
They've been ignoring reality for a while. Why stop now?
Kalorama_Master | a day ago
That’s the beauty of unsustainable trends in economics, eventually reality sets in. So while the MAGA base happily eats up the tall tales and AI imagery, reality will eventually come knocking
grossguts | a day ago
I mean with debt levels what they are and the cashflow required to service said debts there better be less confidence in the ability to adequately service those debts. I realize it's more complicated than that with bond markets but I mean come on, leveraging yourself like that is just crazy and there should be a lack of confidence in whoever does that.
crustyrobots | a day ago
The fools still think this is the 80s when other countries couldn't hit us back. Clearly that is not true and has not been for decades.
Theyre dumbass bullying and market games failed to impress these other countries, and now we shall pay the price for our collective hubris in thinking we were so untouchable. The rest of the world has been looking for an excuse to start removing the US from them finally, and now its a matter of survival to do that.
All empires fall.
never_safe_for_life | 18 hours ago
That’s not the only out. The other one is high rates and high inflation. Spending on debt reserving will crowd out other aspects of government spending so services will get poorer. While inflation wreaks havoc on the populace but decreases our debt load.
It’s the realistic path forward so prepare for it. Own scarce assets. Develop skills that command a premium so that your salary keeps up with inflation. It’s going to suck but if you’re smart you can make it work for you
Kalorama_Master | 17 hours ago
Angry upvote
rednail64 | a day ago
If the 5-year yield tops 5% it could fundamentally change risk-allocation strategies.
Higher borrowing costs and competitive risk-free returns from bonds could increase valuation pressure on equities, as they look less attractive.
The next two days are going to be very interesting.
gidimeister | a day ago
Someone said it brilliantly elswehwere: Bessent is smart enough to know that this was all bullshit and likely a bad signal to the market. But he has completely imbibed the hubris and sychophancy of the Trump court.
EHG_Boston | a day ago
Agreed. The smirk he displays publicly speaks volumes about his cognitive dissonance.
crustyrobots | a day ago
I look forward to the pending collapse wiping that smile off of his dumb fucking face. Or maybe we just help him with that with an angle grinder
Appropriate_Formal64 | a day ago
I'm not great at economics, but all of this feels like the super powerful elite insiders gaming the system to reap the benefits at historic levels while everybody else gets fucked, then somehow blame democrats when the base notices something even more wrong than current conditions two years from now, run on it, promise to fix it, get back into power and keep doing this.
hamfinity | a day ago
So, the same thing as the last 50 years?
Appropriate_Formal64 | a day ago
Basically, but its more out in the open than ever.
Beneficial_Map6129 | a day ago
Well just FYI, this will affect EVERYBODY in the world. And yes I mean EVERYBODY.
The entire world is built on USD.
No matter if you are Swiss, Chinese, Zimbabwe-an, rising yields in the US are not good for anybody
And they are currently breaking record highs not seen since 2008.
There are 2 options for the government here.
And neither one is good news.
mmoore327 | a day ago
Agreed and yet the rest of the world still wants the US to fail spectacularly. Why? Because it seems like the most likely path towards a return to some level of normalcy at least eventually.
TortyPapa | a day ago
These maneuvers do nothing about the debt. Issuing short term T bills to finance these buy backs will end in a disaster if they ever raise rates. The constant rollovers and return to auction (probably every 4 to 52 weeks) will crush them if rates move up even a little bit. They will have to keep issuing new T bills to pay off maturing ones at higher interest rates. For these reasons I don’t think a rate hike will happen next week.
AFerociousPineapple | a day ago
Can I get a short history lesson here? What happened in 2023 to avoid catastrophe? Was it something the market naturally dealt with or did the US gov do something in particular to try ease this? Because I don’t recall anybody being very up in arms about this 3 years ago… seemed like business as usual.