A garbage article. Yields went down after the housing bubble in 2007 because the central bank interest rates were lowered, not because the investors decided to flock to a safe asset.

Yields are high because the inflation is also running high and it doesn't like it will come down anytime soon so the central bank interest rates will also be kept at a higher level.

Long term bonds can be replaced with short term bonds which are constantly rolled over. The bond yields are pricing in the future interest rates, nothing more.

▲ inigyou 3 hours ago | parent | next [-]

Treasury interest rates just decoupled from bond yields. That's the news.

They were only coupled in the first place because treasuries were seen as the safest of havens. That means everything else had to pay more interest than them. So is that no longer the case?

The last Fed meeting saw high inflation and decided not to adjust interest rates, with the stated reasoning that the market will fix it by itself. This could be how the market fixes it by itself.

▲ CapmCrackaWaka 3 hours ago | parent | prev | next [-]

Check out the federal funds rate over the last 5 years: https://fred.stlouisfed.org/series/fedfunds

Vs the 30 year bond yield: https://fred.stlouisfed.org/series/DGS30

That’s the news. The fed is desperately trying to get interest rates lower, but the free market isn’t buying it. The treasury is also pulling out some very desperate moves to control this, like selling euro for JPY without even telling the EU, we will see how it works out.

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mono442 2 hours ago | parent [-]

30 year old bond yield being 1-2% above the short term yield is nothing unusual

	▲	svachalek an hour ago \| parent [-]
		Their point is directional. Fed is lowering rates but yields are rising.

▲ exceptione 3 hours ago | parent | prev | next [-]

  > Long term bonds can be replaced with short term bonds which are constantly rolled over

Bessent tried that, didn't work to calm down the bond yields. Unless you meant the USA is not interested in longer term bonds, which is obviously untrue, because Bessent is intervening.

  > The bond yields are pricing in the future interest rates

For investors, the price is the risk they want to get compensation for. The investors are increasingly worried about the credibility of the USA. Sure, the USA can print dollars, but Banana Economics Class teaches you that trying to inflate oneself out of debt with reckless printing will have some adversarial effects. You can't fool smart money that easily.

▲ PowerElectronix 4 hours ago | parent | prev | next [-]

selling stocks and buying bonds in a recession where interest rates go down (so bonds are priced higher) and expected revenue for most sectors go down is a no brainer.

Agree, but there's also the expectation of future debt. A bigger debt means a bigger issuance of bonds, so the new supply-demand equilibrium moves the rates higher as it's the only way to convince investors to allocate more to bonds.

Technically, yes, but if you create demand for long term bonds and create supply for short term ones, you'll flatten the yield curve and pay long term yields for short term durations.

	▲	timacles 2 hours ago \| parent [-]
		We are in a different phase of Capitalism, real interest rates will be kept low mechanically. Nominal Inflation rate will always be lied about. Bonds holders will lose value by design. The governments and central banks across the world have no other choice. Corporations and big money have robbed our world of capital and are now changing the game to pull up the ladder behind them

▲ eigenspace 4 hours ago | parent | prev [-]

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