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Two data points collided this week, and together they tell a story worth watching. The 30-year Treasury yield touched its highest level since 2007 last week, north of 5.2%, before the Treasury stepped in, announcing it would roughly double the size of its long-dated buyback operations (10s to 30s) to shore up liquidity. Yields dipped on the news, then largely round-tripped back toward those highs within days. That’s not textbook yield curve control, the Fed isn’t capping rate

What Can the Fed Actually Do About Long-Term Treasury Yields? Long-term Treasury yields have been the story of 2026. The 10-year has pushed above 4.7% and the 30-year has climbed past 5.2%, driven by heavy debt issuance tied to the AI buildout, persistent federal deficits, and inflation worries reignited by higher energy prices. Treasury Secretary Scott Bessent has already moved unilaterally, expanding long-bond buybacks and coordinating currency intervention, putting pressur

Two seismic shifts are rewriting the global order this week, and they have more in common than meets the eye. First, the Canada-U.S. Trade Rupture: yesterday, trade talks between the U.S. and Canada collapsed. The U.S. imposed 50% tariffs on ~$20 billion of Canadian goods, and Prime Minister Mark Carney immediately announced dollar-for-dollar retaliation. Carney called the last-minute U.S. demands "uneconomic, unfair, and undermined the net benefits for Canada." Second, The M

The dollar isn’t crashing. It’s eroding. There’s a difference, and it’s the one investors keep missing. If you look at the top chart below, you can see the U.S. Dollar Index over the past decade: still hovering around 99, roughly where it started. Flat. Boring. It represents the trade weighted value of one fiat currency (USD) vs a basket of other fiat currencies. Nothing to see here, right? Now look at the bottom chart with the price of gold in U.S. dollars: up over 250% in t

While everyone is glued to the long end of the curve, watching the 10-year hover near 4.7% and the 30-year touch 5.2%, the real policy signal is coming from the 2-year Treasury. And it's telling a very different story. The 2-year is currently sitting at around 4.20%, roughly 45–50 basis points above the current Fed funds rate of 3.50%–3.75%. That spread matters. The 2-year isn't just a bond, it's the market's best guess at the average Fed funds rate over the next 24 months. W

The Fed isn’t the only game in town anymore. The Treasury just proved it. Yesterday, with 30-year yields flirting with 5.2% and the long end of the curve effectively on strike, Scott Bessent’s Treasury announced it will at least double the size of its buyback operations for 10-to-30-year debt, from roughly $2bn to “at least” $4bn+ per operation, starting in September. Yields fell within hours. Bitcoin, precios metals and equities rallied on the news. This is the second time i

Long yields are breaking out almost everywhere, and central banks may not be able to stop it. Look at the chart below: US, Germany, Japan, UK, Italy, France, Switzerland, Canada, Australia. In every single one, the 10y10y forward rate (the market’s proxy for the “steady-state” long-term yield) has snapped back up from its 2020-21 lows and is now pushing through levels not seen since well before 2013’s taper tantrum. This isn’t a one-country story. It’s a synchronized global r

Diesel crack spreads just hit ~$102/barrel — up nearly 177% since December. What is a “crack spread” and why is it relevant? It’s the profit margin refiners earn turning crude oil into usable fuel, in this case, the difference between the price of heating oil/diesel and the price of the crude used to make it. Think of crude as flour and diesel as bread. The crack spread is the baker’s margin.When that margin explodes, it usually means one of two things: Either refining capaci

Eurozone inflation is sticky, and markets are repricing everything: bonds, the euro, and ECB expectations. The July flash data came in at 2.9%, up from 2.8% in June and still comfortably above the ECB’s 2% target. Euro area annual inflation is expected to be 2.9% in July 2026, up from 2.8% in June. Energy surged to 10.0% (from 8.5%) and Services stayed elevated at 3.3%, wage-driven stickiness that the ECB watches closely. Bond Yields are reflecting a "higher for longer" narra

Everyone in AI is financing everyone else. Nvidia backs OpenAI. OpenAI commits to buy Nvidia chips. Nvidia backs CoreWeave. CoreWeave buys Nvidia chips and rents them back to… OpenAI. Microsoft and Nvidia back Anthropic. Anthropic pledges billions in Azure spend. AMD puts money into Anthropic in exchange for a multi-gigawatt chip order. Round and round it goes. This is “circular financing,” and this year it stopped being a footnote in the financial statements and became the m

There's been a lot of noise about a "gold-backed yuan" lately. But the PBoC has made no such announcement. What is happening is arguably more interesting. China is quietly assembling the architecture for a gold-anchored currency, one bolt at a time. What Beijing Is Actually Doing: (1) Buying gold like it's going out of style. 21 consecutive months of purchases as of July 2026, with the July addition (~20 tonnes) being the largest since October 2023. Total reserves now sit at

The U.S. sold yesterday 30-year bonds at 5.216%, the highest yield since 2007. The Treasury auctioned $31.3 billion in 30-year bonds. The high yield cleared at 5.216%, up sharply from 5.058% at the prior auction. The bid-to-cover ratio came in at 2.39, indicating decent but not overwhelming demand. The U.S. government is now paying over 5.2% to borrow for three decades, a level not seen since before the Global Financial Crisis. Two numbers released this week tell the story: (

Two numbers published yesterday tell one big story about the U.S. economy. First, the July CPI: Headline inflation: +3.4% YoY (down slightly from 3.5%), +0.1% MoM. Core CPI: +2.6% YoY. The print came in right on consensus. No surprises, which is why equities rallied early and the Fed likely has cover to stay on hold in September. Second, a 10-Year Treasury Auction: $42B in notes sold at a high yield of 4.68%, up from 4.58% last month and the highest since 2007. Bid-to-cover

The July CPI report drops at 8:30 AM ET today, and it could be the most consequential inflation print of the year. The market is expecting a Headline CPI of +0.1% MoM / 3.4% YoY (down from 3.5%) and for Core CPI: +0.2% MoM / 2.5% YoY (down from 2.6%, lowest since January). This isn't just another data point. The Fed's September decision is genuinely in the balance (No meeting in August). After last week's surprise jobs contraction (-23K vs. +85K expected), markets briefly rel

NVIDIA just turned AI compute into an investable asset class, and that's a bigger deal than it sounds. Yesterday, Jensen Huang and NVIDIA announced partnerships with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR to mobilize $500B+ in third-party capital for AI infrastructure. Here's why this matters beyond the headline: (1) Compute is now infrastructure, not just CapEx. For years, GPUs were treated like servers, bought project-by-project, depreciated on a

Japan’s 2-year yield just hit its highest level in roughly three decades, and it’s quietly reshaping one of the biggest trades in global markets. Japan’s 2-year JGB yield has climbed to around 1.5%, as the BOJ signals another hike is likely in September on the back of stubbornly high inflation. The US 2-year, meanwhile, sits near 4.2–4.3%. That still leaves a wide gap versus Japan, but the gap is narrowing. The BOJ-Fed policy rate spread has compressed from roughly 325bp earl

The chart below plots profit margins for three groups since 2015: the Magnificent 7, the S&P 493 (the S&P 500 minus those seven names), and the broader Bloomberg 500. The Mag 7 line has more than doubled, from around 11% margin in 2015 to roughly 25% today. The other two lines? Basically flat. The S&P 493 has crawled from ~8.5% to ~10% margin over a decade. No trend, just noise around a flat line. Here’s why that matters right now. Every earnings call outside of Big Tech has

Yesterday’s jobs report was a shock, and markets are telling the story loud and clear. Nonfarm payrolls fell by 23,000 in July, versus expectations for an ~80-95K gain. June and May were revised down a combined 103,000 jobs. Unemployment actually ticked down to 4.1%, but the underlying trend is unmistakably softening, the US has added an average of just ~34K jobs/month over the past year. Here’s how markets reacted: (1) Equities: Stocks rallied. The S&P 500 pushed toward reco

We are crossing the 6 month anyversaryvof the beggining of the Iranian conflict. It’s time to check where things actually stand with the global oil market. in the U.S., the SPR just hit its lowest level since 1983, around 305M barrels, less than half of the 714M-barrel capacity. It’s been drained repeatedly to blunt price spikes from the Iran war, and a chunk of what’s left reportedly can’t even be pulled quickly due to aging infrastructure. On the flip side, US crude produc

Iran and Oman just agreed on the coordinates of a shipping corridor through the Strait of Hormuz. It’s not a signed deal yet, the joint statement is still in final drafting, but it’s the clearest sign yet that the waterway carrying roughly a fifth of the world’s oil could reopen in a meaningful way. Here’s why the details matter more than the headline: (1) Iran wants to retain operational control: security, de-mining, and maritime services handled by Tehran. That’s effectivel