When core pce inflation was above 2.5% year over year for 27 straight years, we had 10Y yields well above 5 and 30-year mortgages well above 7.5 to go with it

 1967-1993, inclusive.

 

 

US20Y auction average yield 5.047 vs. 4.81 previously lol

It's driving the Reuters writer of this story at CNBC crazy that US Treasury securities aren't selling off lol

Foreign holdings of U.S. Treasuries top $9 trillion in March, data shows

 ... Holdings of U.S. Treasuries surged to $9.05 trillion in March, an all-time peak and up more than $233 billion from $8.81 trillion in February. Compared with a year earlier, Treasuries owned by foreigners rose nearly 12%.

Some analysts said that trend could change in April as the Trump administration introduced a massive trade shock on April 2nd that saw effective tariff rates surge, particularly on Chinese goods.

That fueled a U.S. Treasuries sell-off that, at one point, pushed benchmark 10-year yields more than 70 basis points (bps) higher to nearly 4.6% over the April 3-11 period. The selloff may have included selling from foreign investors, analysts said.

Trump has since paused the imposition of tariffs for 90 days, and the Treasuries market has stabilized somewhat, although foreign investors are likely to have remained leery of U.S. assets. ...

Yeah, I don't think so.

10Y yield averaged 4.28 in April lol, unchanged from March lololol.

The funniest thing that's happening to Donald Trump right now is that while he tries to intimidate the Fed to reduce interest rates and they do nothing, yields are soaring all by themselves

 The bond market is issuing a vote of no confidence in our elected leadership.

One branch of Republican government thinks this is the 19th century with a robust manufacturing base it needs to protect with crazy wild tariffs, and another branch of Republican government thinks it's just fine to go on spending like drunken sailors and not raise taxes to pay for any of it.

Interest payments alone on the national debt in fiscal year 2024 soared to $1.1 trillion against revenues of $4.9 trillion.

Meanwhile the most powerful military in the world can't stop a bunch of rag-headed heathen bastards from launching missiles at Israel.

These people are crackerdog.

US Treasury yields are now up a net 2.37% across the curve since last Friday.

 

Long duration is very unhappy: 10Y at 4.53 at the close yesterday, 20Y at 5.00, 30Y at 4.97.

 

VUSTX ytd total return: -0.53%.

 

 

Trump's phony Liberation Day for working Americans evaporates into thin air, new 90-day pause brings 145% reciprocal tariffs on China, which tanked markets in early April, down to 30%

Stock futures surge. Crude oil surges. US Treasury yields surge.

U.S. and China agree to slash tariffs for 90 days in major trade breakthrough

 

... The trade agreement means that “reciprocal” tariffs between both countries will be cut from 125% to 10%. The U.S.′ 20% duties on Chinese imports relating to fentanyl will remain in place, meaning total tariffs on China stand at 30%. ...

Trump had imposed tariffs of up to 145% on Chinese imports, prompting Beijing to respond with retaliatory curbs of its own, including restrictions on some rare earth elements. ...

Trump calls Powell a fool for not lowering rates, yields rise in response lol

 

Trump calls Fed Chair Jerome Powell a ‘fool’ after central bank keeps rates steady again

 

 

 

Overall US Treasury yields have been falling for a year, but not by very much in the aggregate, and bonds keep asking for a word

Average US Treasury yields in April vs. March were down but up in comparison on Friday May 2nd after Trump meddled again in the Fed's business.

The yield aggregate of eleven securities down: 4.19 in April vs. 4.243 in March, but back up to 4.234 on Friday.

Bills down: 4.205 in April vs. 4.26 in March but up to 4.242 on Friday.

Notes down: 3.966 vs. 4.082 but up to 4.002 on Friday.

Bonds up: 4.725 vs. 4.615 and up some more to 4.80 on Friday. Investors are demanding more return from bonds because they perceive risk to be rising for long duration holdings.

The overall picture since January 2024 though shows yields falling as the rate of inflation has slowly declined. The black line below shows the average of the aggregate peaking in April 2024.

The 10-year Note at 4.33 on Friday matches the Daily Federal Funds Rate exactly, same as the 3-month.

Speaking of which, 10Y-3MO has been screaming "major recession" since October 2022, but to no avail.

 

 

The bond market is more powerful than both the pope and the president combined, so it's telling that Mad King Ludwig The Impotent does this

 

Yields had been falling significantly in recent days, until Trump opened up his big fat yap this morning lol

 

Trump calls on Fed once again to lower rates after solid April jobs report

 

 

Nosebleed valuations continue despite recent stock market declines

 It's a long way down to normal.

The 2022 lows got us back only to the 2000 high, and people thought it was the end of the world when all it was was a good beginning lol.

 

Nominal GDP in 1Q2025 is estimated at $29.9776 trillion by the BEA this morning.

$SPX closed at 5611.85 on March 31, 2025.

That yields a ratio of 187 vs. the historical mean of 81, or 131% overvalued. 

Guru Focus gets similar results from the Buffett Indicator:

 

This week's US Treasury auctions indicated the opposite of rising interest rates

As usual the alarmists and doomsayers are . . . alarmists and doomsayers.

Demand for US debt is steady and strong this week:

3MO at 4.225% average vs. 4.225% previously

6MO at 4.05 vs. 4.06 previously

2Y at 3.795 vs. 3.984 previously

5Y at 3.995 vs. 4.1 previously

7Y at 4.123 vs. 4.233 previously.

Yields across the curve last night averaged 4.240, down from 4.261 a week ago, below the Daily Fed Funds Rate at 4.33.

 

 

 

Mad King Ludwig is in a foul mood this Easter Monday because the Supreme Court ruined his weekend deportation plans

 Trump ramps up attacks on Powell, demands ‘loser’ Fed chair lower rates ‘NOW’

 

High unemployment, high inflation, and high interest rates 6% or higher all at the same time plagued the country for six years 1975-1982, but we survived

 There were six years when all three, the unemployment rate, headline inflation, and 10-year US Treasury yield, were at 6% or higher on an average basis at the same time:

1975: 8.5%  9.14%  7.99%

1977: 7.1%  6.46%  7.42%

1978: 6.1%  7.62%  8.41%

1980: 7.2%  13.5%  11.43%

1981: 7.6%  10.37%  13.92%

1982: 9.7%  6.15%  13.01%.

 

In March 2025 unemployment was 4.2%, headline inflation was 2.4%, and the 10Y yielded 4.28%.

The current data set is no compelling case for reducing interest rates.  If Trump had confidence in his tariff regime, he wouldn't be clamoring for further reductions.

 

The Golden Age of authoritarianism: Confrontation, corruption, contraction, con-jobs, and contempt

 

Trump again calls for Fed to cut rates, says Powell’s ‘termination cannot come fast enough’

 

Trump’s tariffs are ‘inviting corruption,’ Democrats tell Bessent, Lutnick

 

China targets U.S. services and other areas as it decries ‘meaningless’ tariff hikes on goods 

 

Trade war fallout: Cancellations of Chinese freight ships begin as bookings plummet

European Central Bank cuts interest rates, warns of ‘deteriorated’ growth outlook on trade tensions

 

Italy’s ‘Trump whisperer’ Giorgia Meloni to meet U.S. president amid trade standoff with Europe

 

CBP says latest tariffs have generated $500 million, well below Trump’s estimate

 

Judge finds cause to hold Trump administration in criminal contempt in deportation flights case

 

 

UST 20Y auction: 4.81% vs. 4.632% previously

They're calling the 10Y at 4.5% the moron premium because everyone hates Trump and his tariffs, but I don't remember it being called the 5% dotard premium under Joe Biden

People need to get a grip.

Blaming hapless Liz Truss' two-months as PM in September and October 2022 for the UK's high interest rates pretends that the Bank of England didn't raise interest rates in response to inflation same as the US Federal Reserve Bank.

This trashy headline belongs in The Daily Star, not the UK Telegraph. No wonder they're trying to sell you a 1-year subscription for only 29 pounds.

 

 

Week over week US Treasury yields in the aggregate popped 5.8% on net to an average 4.335% after declining for months from 4.5 to 4.0 and everybody's freaking out like this hasn't happened, what, six times now in the current era

Most of the pissing and moaning is from investors who pulled the bond trigger too soon, plowed into fixed income, and got burned badly because interest rates reasserted themselves.

The press this weekend is instead full of apocalyptic language about the Treasury market and the implications for America on a grand scale. It's complete rot and I'm ignoring it. It's all designed to pressure the Fed to lower their rate again.

The last time the Fed embarked on rate cuts is instructive. It was late September 2024. The average of the aggregate of the curve had fallen to just north of 4. Inflation rates seemed to be trending down. So the Fed cut, and voila! Treasury rates hilariously shot upward!

The burn was real.  

$TLT investors, who were down 4.76% in 2021, 31.41% in 2022, up 2.96% in 2023, went down again, 7.84% in 2024 as a result. Ouch.

They are back, itching again for a policy reversal like they have a flea infestation, so bad they are bleeding.

As things stand year to date, long term investment grade investors in VWESX, for example, are down 1.43%. It wasn't supposed to be this way, not again.

So everyone hates the bond vigilantes with the heat of 1,000 suns, and urges more imprudence.

Meanwhile in "cash" you go on making 4.3% or so, and in gold you have made a killing, while stocks reel under Trump's stupid tariff shotgun blasts which are wounding everyone in the field, including himself.

If the Fed had done a proper job against inflation by jacking up the Fed Funds Rate to meaningfully combat the core pce inflation rate of its average 5.35% in 2022 instead of going only where it did, which was 1.69% on an average basis, maybe we wouldn't still have this lingering inflation for the bond vigilantes to demand payment against. Core pce inflation hasn't moved materially off 2.8% in a year now, still much too high.

The bond market is "she who must be obeyed". She doesn't tell you everything you need to know, but she does tell you the most important thing.

But what the hell do I know. I'm just some punk keyboard warrior blogging in his underwear in the basement to the money men. So yippee-ki-yay, you earned it. Especially you Donald Trump, you complete ignoramus.

 

Longer dated US Treasury securities are selling at higher yields at auction this week compared with recent auctions

 US 30-year bond auction: 4.813% vs. 4.623% previously.

This follows the US 10-year note auction yesterday: 4.435% vs. 4.31% previously.

Trump administration admits it paused reciprocal tariffs because it was intimidated by the bond market and backed down

James Carville must be laughing his ass off.

 

The bond market vigilantes scared off Donald Trump and his tariffs: Average yield at today's 10-year note auction was 4.435% vs. 4.31% at the previous auction