Don't Fall For the Alarmism About 30-Yr Treasuries

Is the US skating on ever thinner fiscal ice after adding $2.5 trillion—and counting—to its debt pile over the last year?[i] Many think so, especially as 30-year Treasury yields punctured 5%, hitting their highest levels since 2007. The narrative gained more steam after the Treasury joined Japan in intervening to prop up the yen—a move some say was really motivated by US officials’ push to keep Japan from selling its Treasury bonds. But seeing this clearly requires zooming out to put current yields—and actions involving foreign holdings of Treasurys—in better context. Read Full Article »