Treasuries are not some kind of artifacts that can be stored indefinitely, they are bonds with maturity dates. As they mature they turn into cash automatically and that cash used to come from selling new treasuries. As the demand dwindles the US has to sell its bonds cheaper thus borrowing at higher interest and that interest will have to be paid by selling even more treasuries at even higher interest so it's already a feedback loop.
Not sure what your links are supposed to prove but here is the link[1] to the actual yield on the 10 year bond, higher yield means the bond is sold at higher discount i.e. cheaper.
> higher yield means the bond is sold at higher discount i.e. cheaper
Yes. The Fed set a policy of higher rates. It did that by selling bonds and driving the price up.
Then it set a policy of reducing rates, and was able to do that by just selling fewer bonds. Not buying them. That implies strong demand for these assets. (You can’t use price as a proxy for demand in Treasuries since it’s an explicitly manipulated price by its issuer.)
Long bond rates have somewhat decoupled from short term rates set by the fed. For instance, they just slashed short term rates 25bps, but long bond rates (10+ years) have actually gone up a few basis points since the cut.
This is exactly what we'd expect if demand for treasuries wasn't keeping pace with US debt issuance. I mean, if you look at the debt, and the USD's current position, there really is no way out for the US government other than inflating the currency and cashing in that reserve status for a reset. The obviousness of that reality is why precious metals are going nuts.
> For instance, they just slashed short term rates 25bps, but long bond rates (10+ years) have actually gone up a few basis points since the cut
Could you point to the date range you’re referencing?
> if you look at the debt, and the USD's current position, there really is no way out for the US government other than inflating the currency and cashing in that reserve status for a reset
Of course there is. Loads of options.
Broadly speaking, the talk around rates and commodities tends to involve serious people totally divorced from the talk-show/Zero Hedge circuit.
> Could you point to the date range you’re referencing?
The last two months. There was a rate cut in October and again in December, but since late October long bond yields have been rising.
> Of course there is. Loads of options.
For instance?
The US debt is currently rolling over into higher rates bringing the average yield of our debt up. The only way around that, if long bond yields don't come down, is to roll the debt into short term treasuries where the rate is tied more to fed funds rate. That would be inflationary.
