The hottest Bond Market Substack posts right now

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The Fed Is Adding $20B A Month To The Balance Sheet

QTR’s Fringe Finance • 22 implied HN points • 03 Mar 26
💰 Finance Bond Market
  1. The Fed quietly restarted QE and is adding roughly $20 billion a month to its balance sheet, which is already about $6.6 trillion and could balloon much higher in the next crisis.
  2. Most Fed purchases have been in short-term debt, which has pushed short rates down and steepened the yield curve. The Fed has been losing money and isn’t remitting profits to the Treasury, leaving a large deferred loss.
  3. Foreign buyers have helped absorb new Treasury issuance but their buying has flattened recently, so if the Fed won’t buy long-term bonds and foreign demand stalls, Treasury borrowing costs could spike and further strain the budget.

The Bank of Japan July Surprise

The Informationist • 1100 implied HN points • 30 Jul 23
💰 Finance Bond Market
  1. The Bank of Japan recently made an announcement that caused the USD and Japanese bond yields to shift.
  2. The implications of the Bank of Japan's actions have affected US Treasuries and could lead to the US Treasury issuing more debt.
  3. Investors are advised to strategically manage portfolios due to potential market shifts and economic uncertainties.

Money Market Update

Concoda • 243 implied HN points • 09 Jun 25
💰 Finance Bond Market
  1. The money market is currently stable, with dealers holding more U.S. Treasuries. This might lead to more relaxed conditions in the market.
  2. Investors are not as worried about future issues with T-bills as they were during the previous debt ceiling crisis. This suggests a more confident market outlook.
  3. Upcoming auctions of longer-term bonds are expected to attract foreign investors, which could positively impact yields despite fears about rising rates.

The NY Fed Trading Desk's Time to Shine?

The Overshoot • 373 implied HN points • 01 Sep 23
💰 Finance Bond Market
  1. Central banks should consider being more active in making markets for government debt directly.
  2. During the Covid crisis, bond dealers did not step in to stabilize markets, prompting central banks to intervene.
  3. Constraints on dealers may have led to market instability, prompting discussion on potentially revising regulatory choices.

A watershed moment for bond yields

Klement on Investing • 3 implied HN points • 15 Jan 25
💰 Finance Bond Market
  1. Long-term bond yields are rising again after decades of decline. This shift suggests that investors are now expecting a risk premium for holding government bonds.
  2. Several factors influence bond yields, including government deficits, demographic changes, and the balance of supply and demand for safe investments. These can push yields higher or lower.
  3. The trends observed in bond markets could change how governments finance their debts in the future. It's a developing situation that could impact financial markets.
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Government Default and Riskfree Rates

Musings on Markets • 0 implied HN points • 22 Mar 10
💰 Finance Bond Market
  1. In some emerging markets, companies can borrow money at lower rates than their own government, especially if the debt is in foreign currency.
  2. It's surprising that investors feel safer lending to companies like Berkshire Hathaway than to the US government, even though the government can print money.
  3. The market seems to be signaling to the US government that it needs to improve its financial health quickly, or it may face higher borrowing costs in the future.