UST

Clear-Ad9879

Speaking as a guy who managed fixed income portfolios for institutional clients, here's the big problem with fixed income assets - the government has for the last 30 years suppressed interest rates in an attempt to maintain GDP above potential GDP and to lower its own borrowing costs. People think 5.15% interest rates for 10y UST is high, but take a reality check. Inflation is running at 3% and if you are at a 30% income tax rate, your real after tax after inflation return is 0.6%. That is NOT compelling. Most institutional investors in domestic fixed income are doing it for A/L reasons. So they're borrowing as much as they are lending at these rate levels. They are not net lenders. And why would you be when every government policy is designed to force sub-market clearing levels interest rates on capital?

WizWorldLive

Market forces & Capitalism, are not the same thing. The UST is literally bigger than Capitalism, but not market forces.

Canamerican726

I'll take the steelman there - 'the yield matters because an increase in yield indicates an increase in risk in the underlying asset class, and is thus related to your personal risk tolerance'. Yep, agreed. Although it's the inverse of what the original comment was reading. I'll rephrase as: 'You shouldn't decide to buy a bond because it's yield increased, you should understand that an increase in yield implies an increase in risk. You then need to consider the risk profiles in alternative assets, and how they help you balance your risk out.' With an addendum: The UST rates are quite literally considered the closest thing to 'risk free' in US Dollars. If you're building a portfolio for someone with a low risk profile in USD, it's going to include UST at any rate, because even if the US Treasury is riskier than it was, it's still the best game in town. That's where Intro to Finance ends. Full stop. That's why 60/40 has been around so long. It's not optimal, it's provably suboptimal, but it's better than cash in a mattress. You then go to: That does not mean the UST is risk free, that does not mean a low risk portfolio is literally just UST or USD (then you're fully exposed to several major risk factors without hedge) etc etc. PIMCO is short the long end of the curve right now for a reason. For a low risk portfolio you want globally diversified bonds, equities, alternatives, TIPS, and consider your maturity, fx, inflation, etc etc risk with periodic, automatic rebalancing based on strategy and both macro and micro strategy realignment continaully. But that's a bit much for a reddit thread.

Utilize3372

UST IN: 🍊says "If I knew the market was going to rally after a rate hike I would have kept Powell"

negative-nelly

The UST market completely cratering would not be good for stocks.

parallax__error

Bond markets are black magic to me. But between “I am the house” and “$6B”, I didn’t believe for a second that this was going to go well. $6B is 0.1% of the total outstanding UST bond market. How did they possibly expect that to dent anything?

Good_Ride_2508

VIX is short term for volatility, but long term impact is US10Y yield of UST. Review when the US10Y yield was high in the past 1990 to till date and what happened thereafter. History repeats when VIX is fluctuating and same way US10Y goes high. Good Luck !

Brawmethius

Well the FED does have unlimited buying power, the UST does not.

Anymous2314

Using insider info to manipulate markets is their expertise though. Add the trillions of dollars power of UST and theoretically they should be able to control the market. Problem is: Yen carry trade itself may be more than $2 trillion, on top of that there may be another trillion in long yen positions(directly/indirectly). That is a lot of shit flowing in one direction, not sure UST can control that. All he is doing is: scaring the shorts from making money from this change in tide.

OsamaBagHolding

Pay no attention to the AI companies that also have to issue a ridiculous amount of debt loon chasing the same buyers as UST

CasualObservations-

Dude, you have no clue of the demand for US Treasury’s nor the global paradigm that ensures that demand. Download the UST auction data via the free and public UST API, and you’ll see how wrong you are. The world has been dependent on US Treasuries for some time now because comparatively the US is the safest asset haven in the world. Think whatever you want about how “bad” or “unstable” the US is — everywhere else is worse. If you disagree, you live in a bubble.

GPUssydestroyer

He doesn’t specialize in the UST market he’s a micro econ professor. Also he’s Canadian 

foo-bar-nlogn-100

No, not yet.. US Treasury created swap lines so they dont' sell UST.

SoCallMeDeaconBlues1

A couple reasons. There were some Defi platforms that didn't halt but I couldn't move it. The bigger reason was the way LUNA worked and the algo behind its tie to UST. It became hyperinflationary, and as UST sold off more LUNA was minted which caused UST to drop and... Death spiral.

RandomDudeYouKnow

Same as always, watch bonds. They're already telling the story that the world doesn't trust the UST anymore. Trump has just drastically sped it all up

virtual_adam

If anyone was wondering, the daily volume for UST bonds is $1.2T They are looking to sell less than 10% of the daily volume, and that will also be spread out to avoid losses

GhostDogJef

**Norway's $2 trillion sovereign fund proposes deep cuts to US Treasury holdings** *NBIM recommends cutting bond index's government bond weighting to 50%. Changes would mean cutting nearly $80 billion from UST holdings, Reuters calculations show. Government bond markets spooked recently by rising inflation, government debt.* [https://www.reuters.com/business/norways-2-trillion-sovereign-fund-proposes-deep-cuts-us-treasury-holdings-2026-09-04/](https://www.reuters.com/business/norways-2-trillion-sovereign-fund-proposes-deep-cuts-us-treasury-holdings-2026-09-04/) The manager of Norway's $2.3 trillion sovereign wealth fund has proposed significantly cutting its exposure to U.S. Treasuries as part ‌of a wider shake-up of its bond investments to improve returns, according to a letter published this week. Norges Bank Investment Management has recommended reducing its weighting to government bonds within its benchmark bond index to 50% from 70%, with U.S. Treasuries, the biggest holding, getting the biggest cut, according to the letter. The changes would ​mean cutting nearly $80 billion from the fund's current holdings of about $215 billion of U.S. Treasuries as of the end of ​June, according to Reuters calculations. Government bond markets have been in turmoil recently, with long-term borrowing costs soaring as rising ⁠inflation and government debt levels spooked investors. Norway's sovereign wealth fund, the world's largest, owns on average 1.5% of all listed companies globally. Its ​scale means that portfolio decisions can influence broader market flows. ANY CHANGES WOULD BE DONE GRADUALLY, NORGES IM SAYS The fund's proposals were made in ​response to questions from Norway's finance ministry about the wealth fund's investment strategy for bonds. Norges Bank IM said it would await the ministry's response, and any changes would be done gradually to limit market impact and transaction costs. "We recommend that the government subindex of the bond index be reduced from 70% to 50%," ​Ida Wolden Bache, governor of Norges Bank, and Norges Bank IM CEO Nicolai Tangen wrote in the letter. "A government share of 50% will ​be sufficient to cover the liquidity needs, including in periods of turbulence in financial markets." The fund also proposed considering an increase in investments in unlisted assets ‌in a ⁠separate letter, in part as a way to reduce concentration risks that have grown in its equity portfolio amid the boom in the share prices of a handful of U.S. tech companies. Under its current mandate the fund can own unlisted real estate and renewable energy assets, but it has a lower share of unlisted investments than comparable funds. U.S. TREASURIES REDUCTION Norges Bank IM said the biggest change to its bond index ​would be investing in more non-government ​debt, including mortgage-backed securities, to ⁠give it better diversification and exposure to risk premiums. A spokesperson for Norges Bank IM said total U.S. dollar exposure would remain around 50%, adding: "What changes is the mix inside the dollar market: less U.S. government ​debt, correspondingly more U.S. mortgage and government-related bonds." Under the proposals, the bond index weighting to U.S. ​government bonds would reduce ⁠from 34.1% to 21.9%, according to the letter, with the allocation to euro area debt falling more modestly from 16.8% to 14.1%. The allocation to Japanese government bonds would increase from 4.6% to 7.4%, while the UK allocation would remain unchanged at 4.2%. The fund said the changes would align ⁠the index ​more closely with the broader market weightings. While U.S. Treasuries exposure would fall, the proposed ​allocation to U.S. non-government debt would jump from 16.2% to 27.6%, meaning that the overall bond index's weighting to the U.S. dollar would fall only slightly, from 52.9% ​to 52.5%.

Adrian_Dem

at this point, just change the country name to UST

luv2block

They'll do some kind of weird twist, like having the banks buy the treasuries or some sneaky stablecoin program where they get drug cartels to buy trillions in stablecoins. Or Trump will use the army and threaten to destroy a country unless they buy $500B worth of UST. Regardless, whatever they do, it will be tantamount to QE and it will drive inflation up.

petitchevaldemanege

> but not like anyone in Europe or Canada is really in a position to step up and buy a trillion dollars worth of UST even if they wanted to. I encourage you to checkout the timeline of holdings by European countries (including the UK). The current administration has burned a lot of goodwill. They could have stepped up (and maybe they will), but the chances are lower now.

PalantirImperator

This crisis with the Yen is decades in the making and, at least in the case of Japan would be happening regardless of who was in the White House. US being a better neighbor might help them find a buyer for some of the Bonds Japan might have to offload, but not like anyone in Europe or Canada is really in a position to step up and buy a trillion dollars worth of UST even if they wanted to.

Jeff__Skilling

bro big fiscal numbers are big dawg plus 30 UST yields bruh plus inflation is fr fr

torokunai

the question with raising rates is what the hell you're trying to accomplish with that. Housing is already dead. The main drivers of borrowing is just the UST and big data. real growth in consumer debt: https://fred.stlouisfed.org/graph/?g=1XVXp

Sufficient_Habit5091

That this guy survived a Senate confirmation to join the Fed is some wild stuff. >One way of doing this is to impose a user fee on foreign official holders of Treasury securities, for instance withholding a portion of interest payments on those holdings. Reserve holders impose a burden on the American export sector, and withholding a portion of interest payments can help recoup some of that cost. Some bondholders may accuse the United States of defaulting on its debt, but the reality is that most governments tax interest income, and the U.S. already taxes domestic holders of UST securities on their interest payments. Maybe people will accuse you of trying to default on US debt because that is quite literally defaulting on US debt.

spaghettibolognaisee

Your friends Canada, EU and Japan mainly. You know the biggest UST investors your retarded president is fucking over.

Mr_Big_Garnet_Bear

The way we think of gold is that any appreciation we get is gravy but at this point do you really wanna be in long duration bonds for the “safe” part of your portfolio that’s supposed to be a source of funds during equity drawdowns to rebalance? Don’t get me wrong we also own UST Bills for our emergency fund and money market funds, stable value funds, and short term UST bond funds in our old 401ks. Before the big move we were 40% individual stocks, 25% gold and gold miners, with the balance split between bonds and international index funds.

Krammsy

No one's buying UST's, Trump's not great at making friends. All of this mess revolves around tax avoidance for billionaires, 46 years of it and we're at a wall. All the "trickle-down job creation" went to China, the middle class is stuck with the bill while the household debt to income ratio is double since 1980, Billionaires have it better than ever with boatloads of tax loopholes and SBLOC's that allow lending aga9inst stock portfolios with paying income tax or declaring income. .

Brawmethius

The purpose of the clarity act is to sell more UST. Only reason USG gives a flying fuck at all, Baldy wants stablecoin income and interest but banks are like nah dog. But its clear in there they are like "only collateral you can back it with is USD cash or treasuries."

theoneandonlyfish_13

That’s a fair question because, intuitively, when demand exceeds supply, it would imply that rates should move lower. However, not all supply and demand are created equal. UST auctions only happen once a month (for each maturity), and that’s when most large, long-term buyers, such as sovereigns, decide whether or not to purchase USTs. As a result, auction demand is generally viewed as the gold standard for gauging structural supply and demand. Outside of auctions, secondary-market supply and demand is largely driven by shorter-term traders looking to ride momentum in either direction. Over the long run, that activity is viewed as more noise than signal, even if it moves markets that day, week, month, etc

Good_Lingonberry6626

Imagine announcing UST bond buy backs only to watch rate go back up the next day. Fucking hilarious. What a boot licking clown.

Brawmethius

It functionally buys them from the UST with extra steps. We just put prime brokers as the middleman. Because prime brokers have to buy unsold treasuries, then they turn around and park them in REPO. Its a truly interesting system with other banking requirements that allow the USG to force their debt into every aspect of our financial system and pretending the central bank is independent.

Brawmethius

I mean thats not entirely true, how its setup has blurred the line of independence. See prime brokers. Have ro buy unsold UST, but can then go park it in REPO markets with the FED, who poof money into existence. So its like "independent" but like with extra steps

da_mess

All countries hold currency reserves for a rainy day. The USD is the most widely held currency. Countries also invest some of their reserve funds into gov't debt. US Treasury securities (UST) are the safest (only risk is seen as inflation). Japan is the largest sovereign holder of UST. Last summer, Japan traded a 25% tariff from the US down to 15% by agreeing to invest $550b into the US. Japan can meet its investment commitment by selling yen and buying usd ... or by selling UST to raise USD (or by not participating in future UST auctions, which allows maturing bonds to convert to USD). Recently, Japan has done the latter. This drives up US rates. (Buying USD also drives up rates eventually via higher spending/ inflation; higher money supply=inflation). The key here is that Japan likely threatened low participation/sales of UST. The recent jpy intervention by the US was likely to mitigate this--arguably a problem of the US's own making.

No-Estimate-1510

US normally wouldn't care if you used USD to save your currency in distress (which Japan is in). The problem is UST yields are too high for the US government's comfort and Japan dumping UST will drive yields even higher. Japan is also not a normal country but closer to a US colony. The US heavily influences Tokyo's national prosecutorial services and can direct its prosecutors to go after any Japanese politician if it wanted (and all senior politicians have dirt on them, you just need the warrant to dig deep & long enough). US also controls Tokyo's airspace and has major military presence so if Japanese politicians really pissed off America they could easy Maduro the anyone in the Japanese government. When you know that the US could ruin your career and life by dicta if you didn't follow orders you are going to take that into account in your policy making. If it were India or another more independent country (even Argentina kept their Yuan swap line despite US pressures) they would have sold already but Japan's choices are more constrained. Also, since China stopped rolling over UST in 2018 (they let their UST holdings maturing without buying new ones) its UST holdings decreased by about $600bn, this mirrors the increase in UST holdings of Japan ($400bn) and UK ($200bn). Japan and especially UK are running large trade deficits (UK had been in trade deficit for a long time) and economically it doesn't make sense for them to substantially upsize their UST holdings when current account is negative. It's likely that US already exerted significant political influence over the Japanese and British gov to prop up the UST since China stopped buying.

optionderivative

I think you’d find it worthwhile to read about how repo agreements and pledging securities has been used to avoid the sell off pressures you’re describing. To be clear, I agree that there are deep implications to the deterioration the carry trade and I don’t see how the problem sorts itself out. But there is plumbing in place that makes the forced liquidation of UST holdings an unlikely strategy. I think the problem will manifest more gradually and be reflected in a widening spread. There are real issues in the real economy if the cost of funds gets too high.

Low_Pineapple_1558

You're looking at fixed income like its an equity. The thing about fixed income is that it's fixed income. The market value changing doesn't matter if you're okay holding it to maturity. You'll keep getting your 5.25% if you buy a 30yr UST today regardless of what markets do.

ShamWowGuy

Buying UST's so the Japanese don't dump them. Anything else?

ButtStuffingt0n

It's actually not a cycle at all. It's been the exact same thing for 6 month (Iran fucking us over a barrel). It just feels like a cycle because Trump declares victory/end every time oil or UST10s blow out.

PurpleReign123

Except the dividend yield on S&P500 is about 1.06% now, way lower than any US treasury yields. Even after today’s job numbers, the 10-year UST is 4.62%

Equal_Heat5947

Not when you correct for duration lol. Ain't no corporation on earth ever offering UST rate for 30 years

Brawmethius

The 10yr UST is a literal barcode RN. Pretty crazy to watch the single largest bond component in the bond market do shit like that.

Brawmethius

Nuking dollar to save the yen, so they dont dump UST is the game being played. We are watching a battle of yield control on bonds.

Findletrijoick

VTI, VOO, UST bonds - 750k, 200k in mag 7, 50k into ONDS RKLB ASTS

No_Feeling920

Rumour? Bro, just looking at the chart pretty much confirms an intervention. 😄 And Bessent is helping them by talking up the Yen, likely because his cheeks are clenched from the possibility of further big UST sell-offs by Japan to fund these interventions. [https://investinglive.com/forex/treasury-secretary-bessent-appears-to-endorse-yen-intervention/](https://investinglive.com/forex/treasury-secretary-bessent-appears-to-endorse-yen-intervention/) (I could not find a suitable clip of his Fox interview)

DJSlaz

Do you even know what the fed funds rate is? I don’t understand the obsession with fed funds these days as so little is predicated on fed funds rate anymore. Mortgages? No. Commercial Paper? No. UST yields? No. Corporate debt? No. Credit cards? No. Some floating rate notes used to be based on fed funds, like bank notes or mtns, but you don’t see that much anymore. Fed funds basically represents a floor for certain overnight and short term borrowing. like the fed window, for example. the UST markets have a larger impact on the overall economy because most borrowing, like mortgages or corporate bonds, and yield and swap curves are based off of the UST curve plus a spread. I can at least give Warsh credit for wanting to shrink the Fed’s balance sheet and wanting to halt asset purchases by the Fed. It’s time that the Fed and other central banks stop the QE and QE type interventions and ended the moral hazard that entails, as well as artificially propping up asset prices and keeping rates artificially low. That will have a larger impact on the economy than the fed funds rate.

Mail_Order_Lutefisk

Japan sold over 5% of their UST allocation in May and it moved the Yen 4 points for about 3 weeks. I can’t imagine how tight the buttholes are puckered at the BOJ right now. 

SanDisk_Made_Me_Rich

1. The ROI on AI infrastructure spending is abysmal. 2. The Chinese are offering 99% discounts on LLM. 3. $UST yields are spiking. 4. Oil analysts are forecasting $250 oil. 5. Private credit is imploding. 6. The Iran war is escalating. 7. The trade war is escalating. 8. The housing market is frozen. 9. Consumer confidence is crumbling. 10. The Fed is preparing to start hiking rates.

tzacill

UST10 at 4.7 is making me uneasy. stay clear of stocks, safe haven it is.

oilcantommy

What is the? I am a dumbass. Is it that obvious? I dont understand UST?

Timely-Group5649

UST. He's not interested in Earthers.

Neat-Concentrate-239

Bro, let me give you the actual technical analysis on this that BI are not going to give you. In 2016 Netflix gave The Shannara Chronicles, an adaptation of Terry Brooks' The Sword of Shannara. It featured Poppy Drayton and the smoking hot Ivana Baquero (Ivana baquero too if you know what I'm saying). Anyway, it had threesome-UST with the main character (A wasteman, dw about him) which eventually escalated to a FOURSOME-UST with Asian hottie Malese Jow in season 2. And what happened with all this UST with all these hotties? CANCELLED. Nah, NFLX can go to $0 for all I care.

teh_herper

The Terra-LUNA collapse in May 2022 was an unprecedented cryptocurrency crash where a once-booming $45 billion ecosystem wiped out investor wealth almost overnight. The wipeout erased over $60 billion from the broader market and triggered the bankruptcies of major crypto lending and investment firms. The catastrophic failure was triggered when TerraUSD (UST), an algorithmic stablecoin designed to maintain a permanent $1:1 peg, lost its parity with the US dollar. Because UST was not backed by physical reserves, a sudden surge in mass withdrawals overwhelmed the system. To artificially defend the peg, the protocol algorithmically minted trillions of the sister token, LUNA. This hyperinflationary "death spiral" caused LUNA's price to plummet from over $119 to virtually zero within a matter of days. a la gemini

BudLightLymeDisease

If China starts selling off UST everyone's going to have very calm, logical reactions

MoneyMonsterStudios

Comparing the liquidity of *any* emerging asset to the US Treasury market, the literal bedrock of global fiat liquidity,is the real galaxy-brained move here. No one is saying BTC is deeper than the $25T UST market. The point is that for an institution needing to move $50M to $100M into a non-sovereign asset at 2 AM on a Sunday, Bitcoin offers instant, programmatic liquidity with minimal slippage compared to almost anything else outside of major forex pairs and mega-cap equities. You don't need to be on crack to understand the difference between asset size and transactional velocity. But if your "friend" still wants some, tell him it's called SHA-256.

robotlasagna

>Bitcoin is probably one of the most liquid assets available to large investors. Dumb. The UST secondary market alone has an average daily volume of $1T. Bitcoin total market cap is $1.27T If you think bitcoin is a liquid asset you're on crack and also can I get some? (for a friend)

Anymous2314

I am not going to risk 50% loss for earning 5.1%. This is why 30 year UST is kind of horrible idea with Fed being filled with loose monetary policy folks. Fed Chairman can be easily looking to make inflation go to 6-7% next few years while they keep rates lower than 5% using Fed's balance sheet(QE).

Anymous2314

Only problem I have with this analysis is: Things changed after 2009, austerity is no longer accepted. Also after covid, central banks will use infinite money creation to stop deflation, which is very good for stock. After 2022, stagflation has been an issue since supply of money and velocity seems to be unbounded. Liquidity can do whatever it wants with stock valuation. Monetizing debt is a big problem for bonds, hence most people do not want to invest in 30 year UST anymore. That said, nobody knows the future but I am seeing stagflation in near future not deflation, so both bonds and stock may get killed or may be stocks will outperform bonds due to people not caring about valuation at all.

zxc123zxc123

Imagine making your investment decisions based off of the ramblings of a 3yr old who's shitting themselves and a group of 9yr old terrorist-fighters all claiming they are the leader. Market already did the thinking for you: 1. Dipped but gone back up + broke to new highs = market thinks current war w/o escalation priced in (💎✋. Don't 🌈🐻) 2. Higher oil + energy sector/stocks = market thinks war likely it's going to drag on (✋🛢 if you have some) 3. Inflation hotter = Long bond yields up + bonds down = market thinks Fed rate might hike but not that much so market doesn't have to dump (Disregard Long UST. Build ST bills/cash for defense like Buffet/Trump/Dalio/Bezos/Zuck/Dell. 💎✋ stocks against inflation) It's really not that hard.

bluejeff1976

I think future historians will mark the time period when people bought stocks regardless of valuation, ceasing the benefit of capitalism where scares resources were efficiently allocated in public markets. See the book 1929 by Andrew Ross Sorkin. Price discovery is gone already. Stocks are a currency and inflation play now. There may not, however, be real returns in the stock market for a decade, BUT if you don’t hold these assets and get a nominal return you’ll be a victim of the OBVIOUS financial repression policy. This wasn’t started by COVID—it started in 2008. You lost money in Treasuries on a real basis since then. It’s theft by the policy makers on the American people and foreigners who buy UST. The OP is right, though—it’s the only way out. Poor people are going to get smoked.

Salty-Bid1597

Stampede to float before UST yields hit 6% and we get The Big One. Anthropic next week probably.

iShitBloodandCumShit

UST 4.25% looks like it could HS. Currently sitting on the right shoulder.

ImaginaryHospital306

It’s all about liquidity. Geopolitical events have caused a massive redirection of capital from trade financing to equities. Where is capital going to go right now? Not Europe, definitely not the GCC, not Asia. UST yielding 5% but nobody wants it (yet) and sovereigns are selling them to buy oil. It will not end well but nobody knows when exactly.

Brawmethius

The entire system is plumbed to print money and go up. Unless you see a mechanism for this to collapse (which I struggle to, because the FED literally poofs infinite liquidity into existence). So the only credible collapse I see is bond market throwing a fit because they stop trusting USD, or the USG actually defaulting on payments. Otherwise the FED and UST have free reign to issue debt and poof USD into existance as long as the global markets at large accept that.

notextremelyhelpful

Yes, they're both referring to the same type of strategy. 1. Large majority of capital goes into risk-free liquid assets that have small relative haircuts to the marginable collateral (e.g., short-term UST since the yields are already most of the way towards your return target) 2. Juice the remainder of the return target via high probability-of-profit trades with large tail risk (when the trade goes wrong, it goes VERY WRONG). Selling far OTM puts (i.e., picking up pennies in front of the steamroller) is a very well-studied approach. I'm sure you can find any number of resources/backtests confirming the P&L curves. The real question becomes: Have you ever come across any reputable resource or backtest that a 0.5% return per month is even REASONABLY possible? Empirically, the evidence points to "no". With extremely few exceptions, every strategy that boasts a high probability of winning on any given individual trade is inextricably linked with enormous tail risk. That's what you're actually getting paid for - taking on the tail risk. If there were a nearly risk-free way to achieve those consistent monthly returns WITHOUT the tail risk, it would almost instantly be priced out of the market, because everyone would do it. One of the pillars of options trading is understanding the risk dimension you're accepting for the return dimension. No free lunch and all that jazz.

richbeezy

Tis all about the 10 yr UST and the 4.5% level. We go over that and we going down. Otherwise.......UP.

CarRamRob

And why did the UST10y go gangbusters? Inflation caused by a commodity crunch. Why during this commodity crunch wouldn’t it do similar? In fact the bond markets are suggesting things aren’t quite that resolved. They at least look like there is still a lot of concern about the economy even if the equities market doesn’t.

Pearl_is_gone

What tanked the market was UST10y going from 1% to 5% alongside broad inflation, not rerouting Russian oil lol

Pyromelter

Good options there, I think part of my hangup is that there are SO MANY choices and options, my head starts spinning and I can't really figure out which way to go. If we had a fed bank that would actually keep rates at reasonable levels (thinking like 4.5-7%) for the long term, a UST bond ladder would make sense for very steady money, basically just making my own CD's. Current 10 year at 4.3% just feelsbadman, and you just know they will go lower in future years.

No_Feeling920

They can probably keep the lights on by restarting yield curve control, but crude going up in USD and JPY going down in USD will make energy costs prohibitive (inhibitive) at some point (as well as many other imported basic materials). Or they can try selling off their UST/USD reserves (and buy back JPY) to boost JPYUSD, but that can't be done forever and Trump/Bessent won't like it at all, as they also want lower market yields on USTs.

Brawmethius

The only mystery is why the bond holders tolerate being robbed... Oh wait that isn't a mystery either, forced collateral holders to access the liquidty and buyback from primary dealers. If you want access to the American financial system you are forced to buy into the casino. In American policy: UST selling directely to FED is big bad and proves no idepedence of central bank. UST selling to prime dealer to be bought back on open market by FED, is however excellent independence by the central bank.

ValarOrome

lmao hell no, oil reserves are being depleted across Asia, and it's just a matter of time before Iran starts targeting energy infra in the gulf. Oil will go up for sure, and most likely Japan will have to start dumping equities and UST to be able to afford oil. Iran might be taking a financial blow but to them martyrdom is the good ending, financial collapse is absolutely nothing to them, plus they have other routes to get their oil out.

Finger_Think

Is the UST selling oil futes?

Money_Do_2

I mean, global conflagration in exchange for oil price increase is really, really stupid so its possible. Also the UST is considering trading oil futures now. If you thought it was volatile before... an open hand to play against is on the table.

Extension-Ad917

UST yields headed back to where they were before the ceasefire

johndsmits

*"I'm surprised the market isn't down further..."* that was the sign folks, put'in time (and oil being shorted bu UST/🥭 buddies--yup).

Such_Stand_2360

I lost £50k in Luna and UST and then lost 20 Eth in Celsius wallet in 12 months ... your tried you need to learn from mistakes and grow

LarryStink

Carry trade is over the liquidation event already happened. JGB/UST spread juice isnt worth the squeeze anymore. 

ecoburner87

USO can crash any day now or never reach its previous high as UST sells into strength, SPY will crash slowly and then all at once within the next few weeks (less risk)

schoenwetterhorst

Liqudity in UST is abysmall right now. I'm surprised we don't see stronger yield fluctuations

TI-99A

Checks dive in 10 year UST price.  Treasury market forcing his hand.

weekendworker99

After the UST yields have peaked!

No_Feeling920

Gold is multiple things mixed together. If it was only the inflation/dilution aspect, I would not be so bullish on it. What convinced me is that US/USD is losing its trustworthiness (wonder why, LOL), prompting countries like China, India and others to pivot from holding USD/UST to holding (buying) physical gold. Also banks started recommending 60/20/20 (stocks, bonds, PMs) portfolios instead of the 60/40, so once the western retail starts piling in, there will be some more upwards pressure.

Sean_VasDeferens

I'm going to try to help. After 25 years, and now gliding into retirement so needing to be conservative I finally have enough cash, mainly from not the markets, to be uber conservative. I now employ a slow and steady highly diversified multi-income approach with a goal of 15-25% annual returns. I wheel only non-tech blue chip stocks. Each target has an annualized ROI of 10%, closing early increases the return and is viewed as a gift from the Wall Street gods. The wheeling is backed by cash sitting in laddered 90 day UST's returning 3.6%. So right there I'm getting 13.6%! 30% of my funds are in JEPQ ad PEO using DRIP. That's giving me 10% compounding. Then for daily fun I have short term SPX Iron Condor strategies that are very conservative and work for me. I only swing at the easy pitches here. This is what I view as fun money and when added to the above it gets me to an annual return after taxes that gives me a consistent net after tax return of 15-20% each year. For me an annual return of 18.3% is 15% after taxes. Take $100K with 15% after tax return, that will double every five years and grow to $1m after 16.5 years. Now add to that other income generators like buying and fixing up real estate on the weekends and having a good 9-5 job with an employer match on the 401(k) and you to can retire in your early fifties. Added to the above is that I was raised to live like a peasant. This Sunday I'll be replacing the brakes on my truck for $175, it should take two hours. A garage would want $900 for the same work. Take this one act of peasantry and multiply it over the course of every day of your life and you'll save easily $1mil of your after tax dollars, and you know that when shit gets done it gets done correctly and not by some high school drop out.

DeltaP2SavetheE

How long can the UST stay short oil? This is insane. We are really hellbent on destroying ourselves aren’t we

johndsmits

Biznews just speculated Treasury/Bessett could be shorting oil and why prices holding at 90-100, mind the markets going positive. I would not be surprised UST doing offensive moves like that, afterall it's a econ war too. Problem is that the biznews wonk said "what happens if UST is given a margin call" (yikes).

Technical_Scallion_2

None of us have a crystal ball and you may be right. My opinion is that the US Empire is in decline due to multiple factors and is like the Titanic just after it hit the iceberg. Countries are gradually weaning themselves off UST and USD and moving to other markets - I don’t see this cycle reversing, I see it gradually accelerating downwards. But we’ll see

alt-co

Furthermore, FTX was an early investor in Anthropic, which partly got sold to Jane Street (largest buyer) post Terraform Labs - UST Luna collapse. This is a serious conflict of interest because Jane Street is currently being sued by Terraform Labs for allegedly manipulating UST's crash.

InvestigatorPlus3229

wow some wild swings on the 10 UST

ecoburner87

It wasn't. Fed or UST we're buying equities imo

HesFromBarrancas

It’s an inflationary event, so you have to bear that in mind re UST. RE USD, a number of factors; again, inflation trade. Technicals were overextended. Fed uncertainty resolved. Still heart of world trade.

Dry_Tomorrow3632

back then when it was hyped i also didnt think it was possible for UST to fall that hard lol (i just got into crypto around 2021 so little knowledge at that time), but was proven wrong when the depeg happened,

Puzzled-Service5889

A serious suggestion of a withholding tax on the interest paid to non-US UST holders is a signpost along the slow-at-first-then-all-of-a-sudden collapse journey

Canamerican726

Also - the plumbing of the global financial industry is heavily reliant on treasuries/dollar ('exorbitant privilege'). High inflation devaluing dollar, higher US gov't borrowing costs are problems, but there's a ton of inertia in USD for a lot of reasons outside of treasury yield. Even given a doomsday scenario for the dollar, it's not as simple as buying EUR instead of USD. No other country has the depth, breadth and complexity of US capital markets. It would probably take at least a decade of regulatory work, capital investment, internal process changes and major software overhauls in every financial institution for another country to offer an alternative. And (I work in the industry) - no one is seriously making a bid to displace USD/UST. As to which side of the scale weighs heavier - well, we'll see. But it's not just a question of relative yields.

AllCapNoBrake

Eventually it will have to fully unravel. The only fail safe is the UST printing the shit out of the USD to buy the JPY.

robotlasagna

Chinas (or any other countries) ownership of US Treasuries or lack thereof has nothing to do with the dollar being the reserve currency. Countries seek to own UST because they need to put their money somewhere where they can get a return that is very low risk. UST is that investment. When countries invest in UST they are giving the US those dollars in return for more dollars later. Countries using the dollar as a reserve currency means countries hold large amounts of USD in their central banks and use that liquidity to facilitate transactions. They do this for a number of reasons but typically because its way easier to transact in a currency that is stable. China decoupling from UST will cause pain for the US by raising yields but they are not showing any indication of not using USD in their central banks.

ndwillia

That’s what the average person sees it as, for sure (inflation hedge, yada yada yada). Metals are a hedge to USD, but what happens when the hedge is no longer needed by the central bank that levered up on the metals in the first place to protect their portfolios based in USD? They sell their US equities and/or UST and bring that money back to their domestic markets because they’ve extracted the maximum they can from US-based portfolios. USD going down due to foreign yields rising has no affect on the metals used as a hedge in the traditional sense. What’s going on right now with foreign vs. domestic markets hasn’t happened in years, so it’s really easy to assume that the use case for precious metals is still the same now as it had been up until recently.

ndwillia

That’s what the average person sees it as, for sure (inflation hedge, yada yada yada). Metals are a hedge to USD, but what happens when the hedge is no longer needed by the central bank that levered up on the metals in the first place to protect their portfolios based in USD? They sell their US equities and/or UST and bring that money back to their domestic markets because they’ve extracted the maximum they can from US-based portfolios. USD going down due to foreign yields rising has no affect on the metals used as a hedge in the traditional sense. What’s going on right now with foreign vs. domestic markets hasn’t happened in years, so it’s really easy to assume that the use case for precious metals is still the same now as it had been up until recently.

ecoburner87

USDJPY refuses to go down, UST's got the algo set to UP ONLY - what a shitshow [https://www.tradingview.com/chart/PdHKArhV/?symbol=OANDA%3AXAUUSD](https://www.tradingview.com/chart/PdHKArhV/?symbol=OANDA%3AXAUUSD)

ecoburner87

it's a bunch of converging things at once, like Davos/Venezuela/Greenland/Iran/Fed chair. just 1 of these events would create wacky dynamics in our markets for a couple weeks, but they're all happening the same damn month. and while that's all happening, China is unloading US Treasuries (weakens USD) as a troll move while UST tries to coordinate with Japan

ecoburner87

it's really complicated but here goes: less than a month ago, Japan announced a snap election (to take place this upcoming Sunday), for voters to approve 1) tax cuts and 2) money printing/big spending. bond traders saw this as an inflation signal (for the yen), real interest rates spiked up super quickly. our entire system of leverage is tied into Japan's 0/LOW interest rates ("yen carry trade"), many players were caught off-guard by the quickness of Japan rates going up, potentially ruining the whole mechanism American hedge funds use for leverage. this coincided with🥭causing a mess at Davos and Europeans starting to sell US Treasuries, which weakens the USD. Bessent said he was communicating with the Bank of Japan to coordinate a response. Bank of Japan needs ammo (money) to pay for these tax cuts and programs and also buy up their own bonds to stop real interest rates from spiking, which will definitely start next week after Sunday's election. their central bank has plenty of money to do so, it's in their large AI/tech positions in the S&P and US debt that they're selling back to us. they are THE single largest holder of US debt. meanwhile,🥭said very clearly that he wants the dollar to weaken, it's part of his policy. this last few days, the USD has strengthened extremely quickly since the dip a couple weeks back. i think UST is helping prop the USD value to give BoJ as many yen as possible to defend their currency. as you can see, that's causing chaos in American markets and metals. when this exchange is done, it's possible the USD nosedives again? who knows? this is unprecedented and involves trillions of dollars.