The 10-year Treasury yield hit its highest level since 2007. That's nineteen years of yields so pathetic your savings account paid more than the full faith and credit of the United States government. But now we're back. Bonds matter again. Retail traders who spent two decades ignoring fixed income are suddenly yield-chasers. Adorable.
The summary blames sticky inflation, heavy bond issuance, and an AI-fueled investment boom. Three things happening at once. What are the odds. Sticky inflation means the Fed can't cut rates without looking like cowards. Heavy bond issuance means the Treasury keeps flooding the market because Congress spends money like a divorced dad at Disneyland. AI-fueled investment boom means companies are burning cash on graphics cards and calling it innovation. None of this is on your chart.
Here's what actually happened. The yield went up because the price went down. The price went down because nobody wanted to own a bond paying 3% when inflation runs at 4%. First-year stuff. But financial journalists need a narrative. They need sticky inflation. They need AI. They need a reason beyond supply met demand and demand said no thanks.
Technical analysts saw this coming in May. The 10-year broke resistance at 4.2% and never looked back. Momentum diverged. Volume confirmed. RSI stayed elevated for six weeks straight. You didn't need a PhD in monetary policy. You needed a screen and the ability to read a f*cking trendline.
Meanwhile every pension fund manager who bought duration at 1.5% in 2021 is now explaining to retirees why their portfolio is down 30% on an asset class that's supposed to be safe. Safe. The 60/40 portfolio died and nobody wrote an obituary. They just blamed inflation and moved on.
Bonds spent nineteen years as a place to hide from reality, and now reality charges interest.
Photo by Markus Spiske on Unsplash
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