Former US president Bill Clinton’s aide James Carville once said, “I used to think that if there was reincarnation, I wanted to come back as the president or the Pope or as a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everybody.”
Whether that includes Donald Trump, who doesn’t appear to fear a bond-market rout, is perplexingly unclear.
Yields on US 10-year Treasury bonds seem headed for 5% on the back of a price-reducing (and thus yield-raising) sell-off in response to the next president’s policy ideas that may prove inflationary.
Also Read: Odd response: Why did US bond yields rise after the Fed’s interest rate cut?
Wage-inflating labour shortfalls and tariff-led price mark-ups are worries.
If tax cuts widen the fiscal gap, it’ll only worsen price…
