Treasury Moves to Bills: Financial Repression Before Anyone Calls It That
🚨 Nobody wanted the 20-year when they brought it back in 2020 and nobody wants it now. Dropping it is just clean up.
The Move to Bills
The part that matters is moving to bills. The Fed just hiked and most of them want to do it again. So Treasury is taking the debt and parking it at the short end, which is the one place the Fed controls the price.
Every Hike Hits the Interest Bill
Think about what that means. Every hike from here goes straight onto the government’s interest bill. Powell could hike and not care. Warsh can’t.
A Buyer That Can’t Refuse
And bills have a buyer that can’t refuse them. Money funds, bank capital rules, stablecoins. That’s not demand, that’s a rule.
This is what repression looks like before anyone’s willing to call it that.
Originally posted on X by Rosanna Prestia, MBA (@RosannaInvests): https://x.com/RosannaInvests/status/2109213224503796193
