George Gammon: Debt drives treasury yield rise amid rate cuts

George Gammon: Debt drives treasury yield rise amid rate cuts
@GeorgeGammon: Debt impacts treasury yields

George Gammon referenced comments by an industry expert about rising treasury yields due to increasing debt and deficits. The expert highlighted the notable steepening of the 10-year versus 30-year treasury curve, which occurred during a period of Federal Reserve rate cuts.

Gammon compared this phenomenon to events between January and June 2008, when the federal funds rate was reduced by 200 basis points and a similar steepening was observed.

The current developments in treasury markets underscore broader dynamics that George Gammon has explored in depth, including the complex relationship between debt to GDP and 10-year yields analyzed in his piece on the debt to GDP inverse to 10-year yields. Additionally, Gammon’s examination of the 75x surge in bank reserves since 2007 provides critical context for understanding liquidity conditions that may further influence bond market trajectories.

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