In 1993, James Carville, an advisor to President Clinton, mused that if he were reincarnated, he wouldn’t choose to return as an elite athlete or historic figure—he’d come back as the bond market.
“You can intimidate everyone,” he reasoned.
Fed Chairman Kevin Warsh is feeling the weight of the bond vigilantes this week.
At the time of writing, 30-year Treasuries remain over 5.1%. Yields tipped over 5.2%—a benchmark that hasn’t been hit since late 2007—upon the conclusion of this week’s rate-setting Federal Open Market Committee (FOMC) meeting. Elsewhere, 10-year Treasuries have nudged over 4.65%, while rate-sensitive two-year Treasuries have slumped.
