The 10-year treasury has always been the global standard for a safe investment. The yield goes up when nobody wants to buy the bonds. This usually happens in bull markets because of less demand for safe bets. In this case it's presumably because the 10yr isn't actually looking so safe.
Possibly. Japan is by far the single biggest holder of US treasury securities. China is second with the UK not far behind. After that it drops off pretty hard.
Yeah, given that Trump and his entire admin has managed to piss off all three. I know here we’re hearing the US out but there’s some heavy red lines we won’t cross with Trumps demands. He’s going to have to concede a lot
Not too sure about a sell-off by other countries tbh.. if other countries‘ central Banks’s be engaged in a mass sell-off of US bonds, ceteris paribus, it would affect the value of its currency. The US$ still holds a special place in the currency regime and central banks are conservative.
So when they invest in bonds that are not issued in its own currency, they often do it for other reasons than other investors, e.g. “steering” the value of their currency.. long story short, I don’t think it’s other countries via their central banks at this point..
This seems the most plausible. Because financial markets are like a foreign language to most people, I fear this information will stick to BlueSky and Reddit. It wouldn't be the first time mainstream financial news lied by omission.
There is no safe haven from economic turmoil caused by an idiot King. The bond market is going to totally collapse, because it is more dependent on Trump policy than the equities markets. The only fools with any faith or confidence in Trump are destitute MAGAs. A massive Depression is coming. Soon.
It doesn’t require them dumping. All they have to do is trickle it out. Nobody wants to buy it.
It’s more like they are putting lady liberty 🗽 on the auction block and laughing at us as her price drops, and they force her to start lifting her skirt.
Not so much spite as necessity. But also do not underestimate how much the rest of the world was sick of American bullying before this. Trump has given us all the chance to move on from post war American dominance and we will take it, it would be insane to trust him.
That's a great point. The rest of the world didn't get a say. Elections were played with, puppets installed. Extortionate loans were made.
But the USA was a stabilising force, in broad terms.
A benign dictator... now a despot.
Are other sovereigns' bond yields dropping, as (if I understand these interplays correclty) we'd expect in a stock slump / impending recession absent the sovereign taking leave of its senses?
The difference between now and the end of the year will be like the difference between when you first heard about Covid and when it was at its peak, people dying all over, not being able to go out etc. Everything right is just _fear_ of consequences. In 8 months those consequences are here.
This increases the cost of government borrowing now, but of course all that revenue from tariffs means the government won't have to borrow any more. Welcome to Trumpanomics.
The 10-year Treasury bond yield is the interest rate the U.S. government pays to borrow money for a decade, serving as a benchmark for other interest rates
The corrupt regime has a tell- just watch what Mangey Taylor Greene and the rest of the trump deliverance clan does with sticks and well know their next plan..
People want cash and are afraid of the market - anything in the market. I started accumulating cash last year. I knew that if Trump were elected, he'd crash the world economy. He told us that over and over. I probably don't have enough to outlast Trump, but I did what I could.
47 has completely destroyed trust in the United States. Politically and economically. Worldwide.
There will be no coming back for the foreseeable future.
Even if MAGA/GQP and 47 were rooted out TODAY, it would be a decade of insanely hard work.
At best.
I think we were semi-forgiven for 45, we were seen as toying with celebrity and we rightfully gave him the boot the first chance we got. But when we went right back to him as opposed to electing an entirely competent and professional opponent.... we can't walk it back anymore.
In Trump 1.0, it wasn't uncommon to say that George W. Bush was our mulligan, but now that we elected Trump, there's no going back. Short memories isn't just a thing that applies to US politics, unfortunately and fortunately for us. I'm not sure if we can recover, but I wouldn't preclude it.
That’s the sound of a debt market that has had about all it can take of Trump’s bullshit. Something’s gotta give or interest rates are going up. 3-D chess is getting expensive.
It annoys me to no end to keep hearing the chess/checkers phrase. Fucker can't even come up with his own phrases, he has to steal them from film. This one was stolen from "Training Day" with Denzel Washington.
The one that irks me is “he doesn’t have the cards”… While Trump does have some cards, his chip stack is $36T in the red. Folks are calling their markers… mixing metaphors again… checkmate.
Ordinarily, investors choose between stocks, which are perceived as risky, and bonds, which are perceived as very safe. When the market crashes, bonds usually get very expensive. Right now, both stocks and bonds are very cheap. That means investors want neither of them.
Or investors are deciding that Euros, or Renminbi, or Yen, are better places to stash their money.
It’s too bad. Being the world’s reserve currency has been really nice. People kept shipping us stuff in exchange for little green bills that we owned the printers for.
10-year yields are effectively the interest rate the government pays to borrow money for 10 years. The less certain people are they'll get their money back in ten years, the more the government has to pay them to borrow it. Higher yield = riskier bet loaning to the US
It's also true that it'll go up if they think they'll get a better return elsewhere, but uh, I don't know that applies in the current investment environment
the simpler explanation is that it goes up when people sell bonds and don’t buy them. which also occurs during mass liquidation. gold price also dropped.
i just didn’t understand the connection between yields and sales
Usually bonds would be in high demand in a volatile market like we have (because the US treasury was considered the safest in the world) however no one wants American debt right now (because of crazy policies) so America is having to increase the amount of interest it pays on its debt = very bad.
Other lay person here. From.what I've read one of the techbro ideas is to tank the $ and replace it with crypto. Insane but, so far, plausible. They're like toddlers with flamethrowers.
Back then it was driven mostly by inflation & perceptions about what the fed was going to do. It seems like the dominant drivers are now panic about where to invest, where to get money to cover margin calls, & possible retaliatory dumping. But I really have no idea. I’m invested in them so I watch.
Best case: stagflation followed by impeachment and economic recovery.
Worse case: depression followed by engineered emergency and fascist takeover.
Stakes as high as they come.
Trump will never be removed from office with our current Congress, and there is no way we'd win enough Senate seats in 2026 to get the 2/3rds needed to convict him.
I don't get this "evil genius" reputation that had suddenly surrounded Vance like a mysterious vapor rising from the earth. He's not Svengali. He's barely Zoltan the All-Seeing.
No worries here: Vance strikes me as a cowardly yes-man, who'll rubber-stamp anything to keep his seat. In two years he can be very well reposting old videos of him saying that Trump is Hitler 🤣 Our goal as a planet is to survive the next two years. PS: just remember the damage to the USA is done
I don’t know. I am not saying I like Vance he’s hateful person but is not a ideological as Trump in his economic theories He would likely listen to advisors and get new ones to surround him
Motherfucker was victim shaming Zelensky, if that whole oval office convo didn't convince you JD is also a psychopath then you really need to open your eyes Cindy.
I'm legitimately worried he'll drop the Bomb somewhere, or swarm Greenland, our NATO ally. He has no impulse control. I read that he was going to pardon only nonviolent Capitol rioters, then said F it and released them all. I thought he'd bomb Tehran in Regime 1, so dearly I hope I'm wrong again.
Any of the economic crash scenarios dramatically reduce the chances for, and efficacy of, authoritarianism. You can keep the people calm and content and controlled or you can keep them agitated and anxious and angry.
yeah, the playbook is to seize power amidst a crisis that you present yourself as a solution to. openly creating one is not going to have the same effect. it'll create instability for sure, but playing the heel in a situation like that only works against you
Engineered emergency - eg major international war followed by reinstatement of draft, incarceration of political opposition, cancellation of elections.
Sadly, some people cried "wolf" with "fascism" and "fascist takeover" so many times, that the general public may ignore it now that it is actually on the horizon. Next it may actually just go ahead and eat: first the crier, then their sheep and then move on to the aforementioned public.
You don’t want to be holding bonds if inflation causes rates to go up - they’re selling out of long term bonds before #trumpflation forces the Fed’s hand to control it
It fits so well too. Like, he’s a serial liar, habitually cheated on his wives, defrauded people, etc. You go down the line, and basically the only sin he hasn’t committed is outright murder. And somehow he has evangelicals proclaiming him as the modern day king Cyrus.
As someone who got out of the evangelical circle he grew up in and was VERY (mostly?) interested in the end times stuff growing up.... He checks so many of the boxes that it legitimately creeps me out sometimes
Especially the mortal head wound "miraculously" recovered from
Treasury futures are getting annihilated right now. 30Y future is down almost 4% since the close. The 10Y is down about 1.5%, which would translate to almost 20 bps in yield space.
I think the issue is that in times of economic uncertainty the rate should be going down because it’s the “safest” investment. It means the world thinks America might default on debt (or at least the odds of it have increased)
The most accurate explanation, imo. The markets are having a "Wait, he's serious? I think he might be serious" moment & they don't have any idea on how to effectively hedge against whatever's coming because nobody's seen anything like it... at least since 1929.
So what is the administration’s endgame? What do the Saudi’s, Trump, his bazillionaire donors at the golf tournament, (and Russia?) stand to gain from devaluing America?
The world no longer sees US Bonds as financial safety. This is what comes from electing someone who bankrupted casinos. He doesn't understand how economies work.
Which is fine, but he’s got Laura Loomer giving policy. They vilified expertise and this what we get, sycophants with no clue about what they’re doing.
From on-again-off-again tariffs to border apprehensions over trifles, America's reputation in the world is fast becoming toxic. People abroad don't want to buy our products, they don't want to hold our stocks and bonds, and they don't want our tourism.
So, when a gov. borrows money, they do so via treasury bonds. US treasury bonds have long been considered to be safe & stable (albeit low paying) investments, because the US has always been economically strong. Investors go to bonds when stocks crap out.
Generally you expect the US Gov to make good on it's debts (especially since the interest return rate is usually 2-3%ish) since the US has a big economy/tax base.
Countries and people will buy these bonds for economic reasons, but also to scratch an ally's back/part of terms on a deal etc.
There likely is more to it then that, again a layman.
Them going up in interest usually is because, well the government is getting desperate for cash & inflation is kicking around. Debt spending without taxes to pay for it, causes inflation & currency devaluation which makes the return even worse.
This can be a reason people stop buying them. Usually they stop because, other investments see better returns, even if they aren't as "safe"
The other reason is because no one wants to scratch the US's back, typically because they feel they are getting shafted in some way. Like say, unfair tariffs.
Typically, in times of market uncertainty, investors seek the safety of Treasury bonds, driving yields down. However, the current situation deviated from this norm.
The 10-year Treasury yield rose rose to 4.35% as of April 9, 2025.
Bond investors, including foreign investors, maybe demanding higher yields to compensate for the expected decrease in purchasing power from tarrif expected inflation.
And perhaps Hedge Fund Activities: An unwinding of the "basis trade" strategy by hedge funds, involving leveraged positions between Treasury bonds and futures, led to forced liquidations and further amplified the rise in yields.
Appreciated. But you have to understand what a person (1) the child of a guy who worked for a commodity trading co (2) with a law degree from U Chicago (3) struggles with bond prices up yields down. I have a WSJ style manual the explains it well but can’t remember it or find it right now.
When investors expect higher inflation, YIELDS have to rise to entice investors and compensate for eroded purchasing power of future interest payments.
I got u. Nobody wants 🇺🇸 debt right now which is very out of the ordinary. As a result the interest 🇺🇸 will need to pay to borrow money has gone way up. This has never happened because America has always been the safest place to park your money. It’s very very bad.
The other side of this is that in previous crashes, the yield drops as investors flee "risky" securities for more reliable and "safe" things like US treasury debt.
More buyers, yields go down. Fewer buyers, yields go up.
You mean are investors buying foreign debt (Eurozone or China) instead of US debt? Honestly, I don't know. You'd think, but the problem is that Trump trade war isn't going to just ruin the US economy.
Europe's and China's economies are going to get obliterated too.
Thanks for that. Appreciate it. I was actually wondering what the implications are for currency. Am sure my questions show I know nothing about finance, but if people are cashing out, what are they cashing out in?
That the U.S. government soon won't be able to pay for anything because it won't be able to finance debt, and the economy will be collapsed because of the tariffs so there won't be much tax revenue.
Interest rates up.
Inflation up.
Dollar down.
Possible currency crisis.
Odds of default increases. (default is a bit of a strong word - you can always print money to repay debts... But you don't want to do that)
I mean you win in terms of answers I English. Excuse us who have no clue. What this means in plain English perhaps may be the most important thing … in the world?
It means the US will have to pay more interest to borrow money to make it more attractive for lenders. Because at this point if you have money and you can loan it to anyone in the world why would you loan to the US and their mad king.
1. US debt becomes more expensive
2. Fed can't cut rates to stimulate economic activity
3. inflation expectations ^^^
4. market views US default as more of a risk
5. potential financial crisis if the US treasury market runs out of liquidity
Bonds or Government Gilts (GG in the title up there) is government debt. So if you buy them you are lending the government money. The government pays you interest on your loan - for you, the yield.
How much interest you get on a loan is based on how risky it is…
Say you had $100 to lend - and 2 people want to borrow it, A is very reliable and always pays you back, B has always been a bit hit and miss, and you think they might be spiralling out again. The only reason you’d risk lending to B is if you got more money in return - so you demand a higher yield.
Bonds (Government Gilts/Debt) have traditionally been seen as one of the safest investments (people to lend your money to).
Because they don’t tend to default on their debts, so you “know” you’ll get your money back… in 2 years, 5 years, 10 years depending on the bond.
That tends to mean you can always invest your money elsewhere and get higher returns… BUT you might lose it (as demonstrated incredibly efficiently in the past few days). Sooooo… when the stock market is very volatile, people often move to the perceived safety of bonds, they’re willing to
Accepts lower returns for less risk. And as more and more people want to do that, the government can offer less and less interest, people just want to know their money is safe and they’ll get some kind of return.
So the yield goes down.
Usually bond yields are inversely correlated to the stock market. If stock seems risky, investors opt for government bonds, considered less risky. This means bond prices increase, and their yield is reduced.
If both stock and government debt go down...
It means that investors view both as risky. They don't trust the US government to pay its debt, so they demand higher yield to compensate for the risk.
It means investors are cashing out and holding on to the cash.
It means the world is not fleeing to US Bonds per normal when the stock market is crashing. In other words - investors are fleeing the US Government (its ability to finance debt).
All is fair in love and trade wars. I hope China dumps its US treasuries and all liquidity evaporates in the market tomorrow. A real message needs to be sent to Trump. His policy is a massive failure.
Trump will never receive the message that he's wrong. It will always, always, be someone's else's fault. Meanwhile, the collateral damage (to everyone's pension at the very least) will be tremendous.
Comments
Or to Americans tbh.
🇨🇳 China $759B
🇬🇧 UK $723B
🇱🇺 Luxembourg $424B
🇰🇾 Cayman Islands $419B
🇨🇦 Canada $379B
It’s more like they are putting lady liberty 🗽 on the auction block and laughing at us as her price drops, and they force her to start lifting her skirt.
It’s uncomfortable for everyone.
But the USA was a stabilising force, in broad terms.
A benign dictator... now a despot.
A MAGA a sell off will crash it.
Insider trading is a sport.
But we were the best of friends. The last 10 years though you've truly taken a drunken spiral downward... Culminating in this 👋
Non MAGA are still welcome to visit, but I suggest you pretend to be 🇨🇦
It’s US I’m losing sleep over.
How long does lettuce last over there?
Goldfinger: "No Mr. Bond, I expect you to rise"
47 has completely destroyed trust in the United States. Politically and economically. Worldwide.
There will be no coming back for the foreseeable future.
Even if MAGA/GQP and 47 were rooted out TODAY, it would be a decade of insanely hard work.
At best.
Errare humanum est, sed perseverare diabolicum.
If you’re too young to remember.
Low prices. But no transactions.
Wwwhhheee!!
“Prices for the 10-year bond drop when confidence is high, which causes yields to rise.”
so the yield is going up
which means investors have confidence?
somebody please explain
Bonds are a relatively safe investment without much risk which is why the yields are lower than the returns on stocks when the stock market is up.
It’s too bad. Being the world’s reserve currency has been really nice. People kept shipping us stuff in exchange for little green bills that we owned the printers for.
and is this mass liquidation for margin calls etc, or are people actually intentionally getting out of bonds due to specific bond-related concerns?
I'm convinced this is at least in part related to how unreliable the US is considered now.
the simpler explanation is that it goes up when people sell bonds and don’t buy them. which also occurs during mass liquidation. gold price also dropped.
i just didn’t understand the connection between yields and sales
The Soothsayer
“Look at those vital signs. Something’s gonna go wrong.”
Repost by George Conway
# be better.
(Bid wanted is a request for price when preparing to sell)
Worse case: depression followed by engineered emergency and fascist takeover.
Stakes as high as they come.
Look it up.
One or the other, brother.
1. Replace creepy Mike ie retake the House
2. Then get rid of Vance, which wd take winning the Senate, too.
3. Then impeach POTUS.
ALL of it depends on winning big in 2026...
Can we wait that long?
Opt 2 is we revolt.
Now, if the same is true with other countries debt instruments, it means the market sees inflation coming.
Otherwise, its saying the odds of a US default on its debt is increasing.
https://www.marketplace.org/story/2025/04/08/why-has-the-corporate-bond-market-slowed-down
Just wait for Trump to wreck the bond market
https://www.telegraph.co.uk/business/2025/04/08/trump-sell-off-is-bad-wait-until-wreck-us-bond-market/
Barrons: Dollar, Bond Moves Are a Warning Sign of Bigger Risks to Come
https://www.barrons.com/articles/dollar-bond-volatility-tariffs-trump-7f2b5676?st=oEwzpu&reflink=desktopwebshare_permalink
https://artists.landr.com/056870854557
Especially the mortal head wound "miraculously" recovered from
https://artists.landr.com/056870854557
🤡🤭
Wait, what?
The bank of England intervened.
It was about this time that the UK tories removed Truss and did a reverse ferret.
Is this (pension funds being forced to sell treasuries) a thing for the US?
So, when a gov. borrows money, they do so via treasury bonds. US treasury bonds have long been considered to be safe & stable (albeit low paying) investments, because the US has always been economically strong. Investors go to bonds when stocks crap out.
Countries and people will buy these bonds for economic reasons, but also to scratch an ally's back/part of terms on a deal etc.
Them going up in interest usually is because, well the government is getting desperate for cash & inflation is kicking around. Debt spending without taxes to pay for it, causes inflation & currency devaluation which makes the return even worse.
The other reason is because no one wants to scratch the US's back, typically because they feel they are getting shafted in some way. Like say, unfair tariffs.
The 10-year Treasury yield rose rose to 4.35% as of April 9, 2025.
https://bsky.app/profile/jeetheer.bsky.social/post/3lmdrrcqjac25
Better?;)
As @captainahab.bsky.social lays out, there are a number of reasons. Some or all are likely to be driving this increase.
More buyers, yields go down. Fewer buyers, yields go up.
Europe's and China's economies are going to get obliterated too.
Inflation up.
Dollar down.
Possible currency crisis.
Odds of default increases. (default is a bit of a strong word - you can always print money to repay debts... But you don't want to do that)
If the US was a ship it's been hit by 2 torpedos.
Failure to remove the captain means it's going to be hit by many more.
I hate autocorrect like I hate finance shit I don’t understand.
Three words: Very Not Good.
1. US debt becomes more expensive
2. Fed can't cut rates to stimulate economic activity
3. inflation expectations ^^^
4. market views US default as more of a risk
5. potential financial crisis if the US treasury market runs out of liquidity
Problem is getting rid of a prime minister is WAY easier than getting rid of a president, even when the president doesnt have a cult of personality
How much interest you get on a loan is based on how risky it is…
Because they don’t tend to default on their debts, so you “know” you’ll get your money back… in 2 years, 5 years, 10 years depending on the bond.
Usually means we'll use inflation to pay you back with wooden nickels
So the yield goes down.
Normally.
If both stock and government debt go down...
It means investors are cashing out and holding on to the cash.
Wish I'd done them all
My summary is that I think it might be time to change the lightbulb:
https://youtu.be/Qa_gZ_7sdZg?si=8A45UMx1JPPe9V7Q