Markets set equilibrium, not Treasury Secretaries.
Bessent thinks he's the "house," the guy with special "insight," to use his term, that gives him an advantage over the punters. Yet he himself headed George Soros's London trading desk when his firm (correctly) thought that it was smarter than the Bank of England.
The fact is that our debt is ballooning and we now have the spectacle of the US defending the Japanese yen so as to avoid the Japanese needing to sell their bloated Treasury holdings.
The words I'd use to describe Bessent are blasé and complacent. That comes across in the article in the following passage:
"Bessent did not appear particularly concerned about America’s ballooning debt this week, however.
“ 'The U.S. bond market has been the best-performing bond market in the world since President Trump came in,' [Bessent] said at an event at Southern Methodist University."
At some point It will collapse.......
The Treasury buying back bonds isn’t new. Its fairly common.
DOGE taught us that most government spending is fraud and most politicians are in on it.
The Corporate Bond Market is overloaded with bonds being issued the finance the construction of the AI infrastructure.
So Bessant is having a tough time talking down interest rates when the Feds are $40 trillion in debt and the AI boys are asking for billions of dollars at the same time.
I will wait to see if Bessant can pull the proverbial rabbit out of the hat.
Bessent is a great Treasury Sec
Bessent has an advantage over the bond vigilantes who are shorting Treasuries. He’s privileged to see the upcoming CPI and PPI reports before the markets. If these signal lower inflation, the bond shorts will be forced to cover, and bond yields will tank. I wouldn’t bet against someone with insider information.
LITTLE STEVIE from Nothing But Crap.