Are Yields About To Blow Up?
The noose is tightening around US Treasury Secretary Bessent’s neck.
London | Brisbane. 17 August 2026. For immediate release.
The intervention on behalf of Japan two weeks ago seems to have led investors to question the credibility of the US, and as the debt clock approaches USD 40,000,000,000,000, there is nowhere to hide.
The 4.7% yield on USD 10 year and the 5.25% yield on US 30 year have been acting like a magnet every time rates try to drop. And they are at these high levels right now. The 30 year yield hasn’t been this high since 2008.
Over the last two years, Treasury has been buying back an average of USD 17 billion per month and, although paused right now, the FED has been buying USD 10-30 billion per month for reserve management purposes.
Let’s get this right. Treasury buys its own bonds. It finances these purchases by issuing bills which the FED buys and leaves on the collateral account with banks, so the banks can lend against it.
The conclusion is an effort to stimulate the economy by giving banks more collateral to lend against. If they want to lend, of course. The other part of our conclusion is an effort to put a lid on all maturities of the treasury curve. Shadow yield curve control.
Mr Bessent knows markets. He’s the best man for this most difficult job, but as mid-terms in November come into view, and with Trump’s popularity at an all time low, he may well have to take one for the team. There may well be too many balls to juggle.
That would be catastrophic for financial markets.
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Ian Reynolds: Trader & Investor | Former Bank Foreign Exchange Market Maker | Early investor in Bitcoin & Tech Founder. Helping investors understand the radical changes coming in macroeconomics and geopolitics.
Suberia Capital: Special situations investing for high net worth individuals.
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