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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.