Bond prices tend to go up in a downturn market as Capital flees to them as the “safer bet” and so the yield goes down. But instead hedge funds are liquidating them to get cash on hand and foreign governments and dumping them too. This is pushing up yields.
Consumer loans tend to follow bond yield trends. As bond yields go up so does the cost of narrowing like home loans and car notes. This is the opposite of Trump’s stated goal of making narrowing cheap again. Him attacking Fed Chair hasn’t helped.
Thank you! I understood (in a very basic way) what was going on until today. I'm gonna dig into why they're being sold, that's what I find interesting. Geopolitics is more my unprofessional area of interest.
If Trump actually goes through with firing Powell, and replacing him with a loyalist (Don Junior? Mike Lindell? Melania?), the bond market will NOT be happy
they've lost some of their fear of debt, want to spend more on important things, but aren't really attempting to replace the US treasury as the financial product that world finance is built on
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