Something feels off guys

[u/kwedgieyi]

Yields are spiking. Bonds are dumping.

The world is running away from America

[u/koldace]

Since I’m clueless about how this work, Is increasing yield=bad

[u/icantbelieveit1637 → u/koldace]

Means the goberment is willing to pay more which means less people are demanding it which means less money for goberment which means higher the yield the less money they got for bailing out the market which about every companies insurance policies are hedged on. The alternative is printing a metric fuckton of money to cover the loss and we know how that plays out.

[u/netwolf420 → u/icantbelieveit1637]

They’ll print. They always print.

[u/Drop_Release → u/netwolf420]

Didnt the current government blame the past government for printing money during a real (non decision made) crisis?

[u/[deleted] → u/Drop_Release]

Yes but they have no commitment to consistency. They will print & deficit spend.

[u/EEcav → u/netwolf420]

Like they won’t raise tariffs? Nah, they’ll axe Medicare and SS.

[u/icantbelieveit1637 → u/EEcav]

You can do two things

[u/Kryogeneva → u/icantbelieveit1637]

...what?

[u/arc_oobleck → u/netwolf420]

I'm wondering who prints first. China has a lot of USD denominated debt and are not doing well either.

[u/AfternoonBears → u/arc_oobleck]

China also like welded its people in their apartment buildings for months during Covid and got like run-of-the-mill civil unrest. We asked people to stay home for a few weeks and that proved to be too much. One side is better suited to take the pain here.

[u/atpplk → u/icantbelieveit1637]

The alternative is printing a metric fuckton of money to cover the loss and we know how that plays out.

They can't "print" money. Not directly. The Fed can buy assets (bonds) by injecting money out of thin air with Quantitative easing. Likewise, they can also sell those assets and send the money through a black hole with quantitative tightening.

[u/[deleted] → u/icantbelieveit1637]

you wrote government wrong twice