# Jobs Crack and Hike Odds Collapse but Long Yields Climb to a 24-Year High Anyway - The Long End & Fiscal Supply - Week of October 6, 2026

> The Long End & Fiscal Supply for the week of October 6, 2026 (podcasts published September 29 to October 6). September payrolls of 29,000 cut October Fed hike odds from about 70 percent to about 24 percent, yet the 10-year Treasury yield hit a 24-year high above 5.33 percent as Harley Bassman, David Rosenberg and Krishna Guha argued over fiscal supply versus the Fed.

## The Long End & Fiscal Supply

### Week of October 6, 2026: Jobs Crack and Hike Odds Collapse but Long Yields Climb to a 24-Year High Anyway

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Last week's issue asked whether the 10-year Treasury yield would push past 5.2% or whether big buyers would step in and stop it. It pushed past. Then something stranger happened. On Friday the September jobs report came in far weaker than expected, and the odds of an October Fed rate hike fell from about 70% to about 24%. In any normal year that would set off a bond rally. This time yields dipped for a few hours, then climbed to a new 24-year high above *5.33%* on Monday. When bad economic news can't bring long-term rates down, the market is telling you something. This week's podcasts spent a lot of time arguing about what that is.

## TL;DR

* *Bonds have stopped reacting to economic data.* September payrolls came in at *29,000* against a forecast of 84,000. Unemployment rose to 4.2% and wage growth slowed to 0.1%. A soft inflation reading came out the same week. Even so, the 10-year closed the week at 5.28% and reached a new high above 5.33% on Monday (Schwab). Treasuries just had their worst quarter this century: the 10-year rose about *87bp* in the July–September quarter, the sharpest quarterly jump since 1994.
* *The big argument is about why.* Harley Bassman says it is "a 95% fiscal problem" and that investors no longer trust Washington. David Rosenberg says it is mostly the Fed: since Kevin Warsh took over, markets have gone from expecting rate cuts to expecting hikes, and about *90%* of the rise in the 10-year is in "real" (after-inflation) yields. Both agree on one more push: AI companies borrowing huge sums now compete with the Treasury for the same investors.
* *The Treasury's attempt to steady the market has largely failed, and Bessent has more or less admitted it.* Krishna Guha (Evercore ISI) says buying back a few billion dollars of bonds in a $40 trillion market was bringing "a knife to a gunfight," and that it may have hurt confidence on balance. Treasury Secretary Scott Bessent told Axios: "I can't control the bond market." This week's 3-year, 10-year and 30-year auctions are the next test.

*(Quick definitions. The "long end" means long-maturity government bonds, mainly the 10-year and 30-year Treasury. A basis point (bp) is one-hundredth of a percentage point. The "term premium" is the extra yield investors demand for locking money up for years instead of rolling over short-term bills. A "real" yield is the yield after expected inflation is taken out. "Duration" is the bond world's word for sensitivity to interest rates: owning long bonds means "taking duration.")*

## What's new

*1. A weak jobs report and soft inflation, and yields still set new highs.* Schwab's daily podcast gave the clearest account. September payrolls rose just 29,000 against an 84,000 consensus. The prior two months were revised down by a combined 60,000, and July is now a *loss* of 10,000 jobs. Unemployment ticked up to 4.2% and wages rose only 0.1%. The odds of an October hike, as high as 70% early last week, dropped to around 14% Friday morning before recovering to about 23–24%. Yet "Treasury yields only seem to climb, rebounding quickly from Friday's jobs report-related dive and forging new 24-year highs Monday above 5.33% for the 10-year note." Colette O'Claire put the market's reasoning this way: "aggressive AI spending, global pressure on yields, and rising government deficits appeared to outweigh one month's soft U.S. jobs growth." The TFTC hosts pointed out the same disconnect on inflation. The Fed's preferred inflation gauge (core PCE) came in "lighter than expected by quite a bit," yields "knee jerked down like five bips, but then pretty much gave it all back in the same session." Fed Vice Chair John Williams said there was "no need for urgency" on further hikes in the same week.

* Podcast: *Schwab Market Update Audio*, *"Treasury Auctions Next After New Highs for Nasdaq"* (Oct 6) and *"Data Flow Slows: Auctions, Yields Take Spotlight"* (Oct 5): [Oct 6](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjGGOrG8WpnpRgUdwGc17FVH03BugfTu8ZIWEbIf7gnrd0OQzmJX3aD5Nj3Dws-2FJBqg8rUkJfriradqqcdqt0hR6YbWtdF-2BxRN8H1iSnH7qtg-3D-3DsDK4_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmX0xgAXWGZU-2Byi2yMh0OyaZyxkrQuH66BsVhwLwhfLQsKsZsF2p5jzdVguyKo9QqkZcn-2FZRQpxQXVipgsZTuYhQLzSI4jJFb-2B-2BIk-2FjnXEX2z7Mn-2FQUXc7bKDjpO09RzVdg-3D-3D) · [Oct 5](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOg-2BEAlG9XwtYeKovQnObkEEZXEXpzBfV2GFbZEezbIQVuY22HTw9NaQtS5iwNimnWyFDmXXo7M8SCogZ1v8eUmhD3F-2FKfcAXAeqGdjDjXTBrg-3D-3DX6Kr_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmVIFNPzbHbWWyAVgSW6EGN15iCHhH8SK8CK1fmgUOXuhIHF-2BWtsRywcxNaNw0LrPfdVgLpx-2FEDVRMfuGyZYRQFskhio-2BQ70bw0LkfbKHZlDPmJT5GqkAw3gWArlt-2Fmmibw-3D-3D)
* Speaker: Colette O'Claire (Schwab market strategist), quoting Colin Martin, head of fixed income research at the Schwab Center for Financial Research
* *Why it matters:* When the long end ignores weak jobs, soft inflation *and* a collapse in hike odds, it is no longer just following the Fed. Something else is setting long-term yields, whether that is supply, trust or competition for capital. That is the core of this week's debate.

*2. Harley Bassman: "It is a 95% fiscal problem."* Bassman, the veteran rates and mortgage trader who created the MOVE index of bond volatility, gave the sharpest fiscal case of the week on Alpha Exchange. "We got $5 trillion of income and $7 trillion of expenses. Interest is now $1.1, $1.2 trillion. They're taking everything to the front end... They're issuing bills and buying back bonds. Kind of a clever idea that didn't work." His arithmetic: once the old low-coupon debt rolls over, "you mark $40 trillion at 5%... We're talking $2 trillion in just interest, which blows away defense spending and everything else. This is unsustainable." His key point is that this is *not* an inflation scare. Ten-year breakeven inflation (the inflation rate implied by comparing regular and inflation-protected Treasuries) "has been hovering at a 235 break-even rate for the last four years... So the market is not pricing in a big inflation." Instead, "we don't have an inflation problem with rates going higher. We have a trust problem." It is "unprecedented to have a 6% fiscal deficit without being at war or being in a recession." He also explains why stocks keep rising while bonds fall. Investors are buying "an entity that makes money and can raise prices with inflation," not "stock in the US government." And he has a blunt verdict on AI borrowers: the five big hyperscalers will borrow roughly $750 billion, "like a third of what the government's borrowing," and "they are totally rate insensitive. They can borrow at $6, $8, $10, $12... any entity that buys a hyperscaler bond is not buying a treasury bond."

* Podcast: *Alpha Exchange*, *"Harley Bassman, The Convexity Maven"* (Oct 6): [listen](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOhqr0Qvihoz3OLrFKJmJJ6HQ6-2FZXcxbQxH-2FIwt-2BbH-2F50gK6n-2FBHFZDIei2ma4t5eDAQHmI0wrIesfmCMBy5Bn1NJFuMAmhBn9baCduKrERH9w-3D-3DTpE3_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmeLp9yHFzPpIwHQquymtnNE3ANeFwbOhBGEcT9LNSNtgyREV2qIBcohlWqTVnGajob3VthmNhW46Y8BAfPoJKZwcN-2F-2F754dhgJNtuaYTlvflnxswImVfc86gQMckQx5fWQ-3D-3D)
* Speaker: Harley Bassman (roughly 40 years in rates and mortgages), with host Dean Curnutt
* *Why it matters:* Bassman is not a doom-monger by trade. He says "don't go short [the] market yet" and that a debt spiral "could take 20 years." But his diagnosis says no Fed move fixes this. Only a credible fiscal path does: "All we need is a path that's agreed upon... Right now, there's no path."

*3. David Rosenberg: it's the Fed, not the debt.* On MacroVoices, Rosenberg pushed back hard on the fiscal story. "When the 10-year treasury note yield was last below 4% in February, the national debt was $39 trillion. Now we're at $40... nobody was talking about it. But now at 40, because it's a zero, everybody's talking about it." His explanation: "regime change at the Fed." When Warsh took over in June, "the 10-year note was barely around 4.4 and we're up about 90 basis points since." In February markets expected one or two cuts. Now they expect "three or four more tightenings on top of what they already did." He confirmed the line attributed to him: the rise is "90% real rates and only 10% inflation expectations." He has two explanations for high real yields. The first is AI borrowing: "three of the biggest of the four [hyperscalers] are now net free cash flow negative. So they're going to the bond market and they're going to the long end." The second is the Fed: "The Fed has taken the cost to carry away. Where are you going to hide? ...you're going to go to the treasury bills. Why would you want to take on duration with such a flat yield curve?" He is also scathing about Warsh's new inflation yardstick, the share of PCE items rising faster than 3%: "A bag of peanuts to Kevin Warsh is equivalent to an automobile." On inflation itself, Rosenberg will "take the other side of the bet" until wages respond, because "labor is 30%... of the cost at the retail level. It's six times more powerful than energy." September's 0.1% wage print helps his case.

* Podcast: *Macro Voices*, *"MacroVoices #552 David Rosenberg: Navigating The Noise"* (Oct 1): [listen](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOj45unsX4lYI9kCMVKuCi8YEUL3kkjq0t9YCYd1AAoBXbVqE3tnJjWaGPHPGO8dcnLW-2Bs8c8vt4t1Q70F45uy3fktXULkEsZ37mm939ITbY4w-3D-3DGQ1C_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmW8GbHoguHFPue05ooCjx7BPkp6PH0RET8bVl-2FYWOYaS4YIaBNTOv42TlRUfmnxqrweKczroyW-2FdWFeiIVhwPzzYOcTXRKFlP-2FTivLYBrIBRB-2B6DMpe88IAgxh5sV-2BltHA-3D-3D)
* Speaker: David Rosenberg (Rosenberg Research; economist and strategist)
* *Why it matters:* If Rosenberg is right, the cure is a Fed that stops sounding hawkish, and Friday's jobs data made that more likely. The problem for his view is item 1: hike odds fell sharply this week and yields still rose.

*4. Krishna Guha: Bessent "brought a knife to a gunfight" and backed off.* On The Real Eisman Playbook, Guha (vice chair at Evercore ISI) gave the most detailed assessment yet of the Treasury buyback experiment. Bessent "at least appeared to suggest in August that he was going to really ramp up this program in a way that would essentially stabilize bond yields." If that was the goal, "you've absolutely brought a knife to a gunfight." Steve Eisman: "More like a butter knife." Guha's best guess at the real aim was to create "two-sided risk" so hedge funds couldn't treat shorting Treasuries as "a one-way bet." But "I think he bit off more than he could chew. And I actually give him credit that instead of getting sucked into an escalation game... he backed off." He added a harder point: "Serious governments like the US government cannot intervene in their own debt market. That's the sort of thing you find more often in struggling emerging markets," and on balance it "may have actually... hurt them rather than help." Guha set out the "perfect storm" behind the move from about 4.5% in July to about 5.25%: AI borrowers "competing for savings"; a shift from "too much saving chasing too few investment opportunities" to the reverse, which means a higher neutral rate; oil and diesel ("diesel is more like if oil was closer to 200 bucks"); and a Fed under Warsh that "hates this thing called forward guidance." On Warsh's balance sheet plans, Guha thinks he still wants to shrink it but will wait for "a window of opportunity when bond market conditions stabilize," because announcing sales now "will drive long-term interest rates through the sky." Eisman floated an alternative "bazooka": loosening bank liquidity rules (the liquidity coverage ratio) so big banks hold more Treasuries. Guha confirmed regulators "are looking at reforming regulations" in that direction, though banks "may prefer to hold treasury bills, not necessarily treasury bonds." Bessent himself, quoted on Squawk on the Street from his Axios interview: "I can't control the bond market. What I can do is try to get people to slow down and think." The CNBC hosts noted yields "certainly haven't" come down since his earlier "bet against me" line. The 10-year was at 5.303% as they spoke on Monday morning.

* Podcast: *The Real Eisman Playbook*, *"5% Rates, Bessent's Failed Gamble & What Comes Next w/ Krishna Guha"* (Oct 5): [listen](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOiioQB5xJPfynCjlJ8WkOCCeSwlFN2BQzL4y47mIl4m-2BFDT1maqFtznf97iI5-2Bs7XHBlya13Ijyvf8Y1cAcrBGVoTUEewvjxPKYFKrOWplVMg-3D-3DtBQo_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmWGHxnK6Gj-2FS3tyNgfOQCovXbTjn-2FyXDyKyVZt39BP4zlqH6zRK7sEAGfqz7s-2FrUnLKyvD1arG1Yut6OCvH2dihQ-2F9g9M7JjW3I1QLFPX1BPNpE6so9rYVu42YER4bhrQg-3D-3D); *Squawk on the Street*, *"9AM HOUR: ... Yields Keep Rising 10/5/26"*: [listen](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjdUoejxBldiyXCX3YtVgJa-2FUYb8BWTTS92AcIWdqbUULLTbBCB1XoendmJy1ygMC-2BxLXE7PT9R1-2F3KIVOlTPbSKBIwbgE5bWLQaB-2Fg5vT6Rg-3D-3DDI5v_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmbINrVdRQcLwBuxTInDdjXyQK03FDyc8lDecMUe1CgK7571Un4dNS8fUp1ynoaRYC55jTSeszu1Yg4wtWv7k1-2BqdrdgcF1WH5BWrkm84G-2BaHaIAeNC04JH0ewmLBK8wUOA-3D-3D)
* Speakers: Krishna Guha (Evercore ISI, former New York Fed official), Steve Eisman (host). Bessent quoted via Axios.
* *Why it matters:* Last week the buyback was undersubscribed. This week the most closely watched Fed-watcher on the Street says the program failed and was quietly dropped, and the Treasury Secretary concedes he can't control yields. The market has tested the official backstop and found it wanting.

*5. Auctions: "death by a thousand paper cuts," and the 10-year and 30-year are this week.* Marketplace's bond segment summed up the auction picture. The recent 2-, 5- and 7-year sales "did not go particularly well," said Winnie Caesar, head of strategy at CreditSights (the transcript labels her firm "Credit Suisse"; the reporter says "credit sites"). "I think that this year for the rates market in the U.S. has been death by a thousand paper cuts." Alex Wolff, global head of macro and fixed income strategy at J.P. Morgan, said the noise in oil and economic data makes it hard "to know what is the right level of yields." Chris Low of FHN Financial said traders' "primary concerns, inflation, excessive government spending, excessive government debt, all of those risks are going to remain in place." Schwab notes a 3-year note sale today (Tuesday) and a 10-year on Wednesday. Marketplace also flags a 30-year this week. Schwab's warning: "A few well-received auctions last month did nothing to slow the yield rally, and a more recent set saw lethargic demand." The TFTC hosts went further, saying "many people [are] teetering on the edge" of calling recent auctions failures. Treat that as commentary: no podcast reported an actual failed auction.

* Podcast: *Marketplace*, *"A tale of two deficits"* (Oct 5): [listen](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjNqwOL3UZTBVWlOaxVao-2F1ARpbOb4s3M2VqyoNrV7I58OIrSmJ25WO4ovLGEUVhVvNA5M2UwWAhavaZ78ROOYlVPQNc-2FWTgKPMij0jfyr39A-3D-3D2Srs_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmQ-2FtQ3rcgga6JB6zIuhqcJI22mA2-2BGYxjmlo06Yiy6GPrP-2FqOJct5yqQquLPq32ESeeuMi5BMp9LPbGJgdTurYRn6DcAD7asHlWgI4PqmaLdl6GEo-2BvI3RjUms7aRl68aA-3D-3D)
* Speakers: Winnie Caesar, Alex Wolff, Chris Low (strategists and economists), reported by Justin Ho
* *Why it matters:* The 10-year and 30-year sales are the cleanest read on whether the marginal buyer of long-dated US debt shows up at 5.3%. A second straight bad result in the long end would hand the bears their strongest evidence yet.

## The debate

### The bears: structural repricing, 6% in sight, duration still uninvestable

* *It's trust, not inflation (Bassman).* Breakevens stuck at 2.35% for four years while nominal yields rose 150bp means the market is demanding pay for *fiscal* risk, not inflation risk. "Inflation is the only tax that both Republicans and Democrats can agree on because you never vote on it."
* *Supply beats demand (Jesse Felder, Wealthion).* Felder applies "an Occam's razor": "an oversupply of Treasury debt coming to the market amid an oversupply of corporate debt at the same time to fund the AI boom." This cycle began with the 10-year at 5%, and historical hiking cycles add 50 to 200bp, so "on average it would probably go to six... you could go to six and a half, seven." He also flags a fragility: the New York Fed has reportedly been talking to big banks about the hedge-fund "basis trade" (a heavily borrowed bet on tiny price gaps between cash Treasuries and futures). Rising bond volatility puts that trade under strain, so "we could see an accident in the treasury market." [Wealthion](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOgo6zn6AJw-2BdhNebA-2F5aV48VvErS7T7-2FD4y-2FZEgq-2BOhpx3mZQ73R-2B0WQFvvhKzsxORLqq53jHGfHgVo3dGSwR1pJ1pjdmd4XvdF4JUmTrQNvA-3D-3DYdxc_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmXPxrAq3EnsaWjN5tJUVcja9KQMEZV1-2BYdGjKIbHkIG1hq-2BjI98H0kQTU0W4SCKc8IkNjGcRVgLulkBSIRBl-2F9wFXNvnHMWagTeeLY0cNoMSB4JXygGuEerlIcu9KNqj6Q-3D-3D)
* *Five forces at once (Cem Karsan, Kai Volatility).* He lists refinancing of 2020–21 debt ("borrowing at two and a half... Now, borrowing at seven and a half"), a Strait of Hormuz he says is "not opening... for like years," crowding out by AI capex, and lost foreign demand. And the "great irony" of the Treasury's own tools: "By doing buybacks, by intervening in the yen... He's telling you they're going to print money... That's debasement at its core. It doesn't exactly engender confidence... at the long end." [Top Traders Unplugged](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOgb5eKW9DInkmn1b5BR4xLLS5zzopD6GIxHQqoNiJ55-2BCnhp-2BbVI7KgGNPNjlGkJa62xAkZV4q-2BJjuKlGjZtCZ-2BnK2oJDyDC-2FqpZyFDG5fXiQ-3D-3DrqFn_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmeq7DIRZzWKneoNz4-2FLhhhzQomRPhsOoCIE0eB9Z2r637tf6hO4xln2uCReHYwxkD6X-2BoNObBrpk0zbSCw28zihWKcKRAVtP4gk-2FgreSJttZ8Nmx3y3BQD1CRfh-2BB28rxQ-3D-3D)
* *Diesel is the inflation channel (Tony Greer, Mining Stock Daily).* Greer sees "no known ceiling" for yields. Diesel prices and refining margins keep inflation expectations up, and he thinks 6% is possible. [Mining Stock Daily](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOhBUqEtRCbmnNR-2Bn-2FJIS7R8IyV-2BYCIYkTsNJ-2FOeWKGvWiJBYKgV4tS6LPiTbiwGySI5U61XOt-2F8rrbnqaQfgUV5lzOtl5iFlES-2BChx4gTzvxA-3D-3DWR0A_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmd8Rv62ci-2BuPNdyL36GSTZWfNkK8HfNuZ4EUXsiSLmgxoXWvyLxUbkNAdyjOyLxdBiHqotZ3VCssdf-2F0KqcJ0p3ciB1RQRS4YozIl06if8RzH-2BBS1O-2BP-2FWMbtK0qi3c06A-3D-3D)
* *The structural academic case (Odd Lots).* The economist on Odd Lots (labeled only as a speaker in the transcript) explains the bears' quieter point. Most of the 2020–2025 rise in the 10-year can be explained by "bonds becoming more stock-like," meaning they now fall at the same time as stocks, while long-term inflation expectations stayed "quite stable." If bonds no longer hedge equities, "there is nowhere to hide," and investors demand more yield to hold them. That is a structural term-premium story that does not depend on a single Fed meeting. [Odd Lots](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOh7RDJ64E3Wkr2Ex-2FDoGS-2BamnhnFQxj7L3qMsnbPxH4IRmxNt-2FykVqM27OCttLOt-2FyzdscAkQ1AzVzfaINh2RCOzTAv-2FoBcwt5okS-2BQERmbuQ-3D-3D2D80_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmW65a5gMIxm63hdZHN9xhNDgzh6n-2BMpYUzQw6zgEZHonOiREe9pZ5xqVvb7eKp1SjUWQs-2Bg4O9gchCx5h6bLZm5vCZ1DXYEeBguZZJDnG4-2F7cbEj0b3CcMJxTV6fs92JWw-3D-3D)
* *Commentator chorus.* Peter Schiff calls it "the mother of all bond bear markets" (10-year at 5.28%, 30-year at 5.63% at Friday's close). Mark Thornton (Mises Institute) calls the move to 24-year highs a new upward regime. Treat both as opinion. [Schiff](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjxAtRhUmghFV9sKo5h7otuS27CuMi-2BjTKYl1nWpQKjTMWeW3Hga689qD1DfUQpjTsvB2TPMu8ngT4RsV2hhlyvdFyk4ihevvZeTyjEHxQ4wQ-3D-3Ds9-M_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmYMwklOysg0civKatW7QHn8Vv8dTeebkqnOxBq2DO4YMBClKqerLSHvG-2B50RwPmQ-2Fhgyz8cdawCy-2BYDbTglwvQPfDmxvh0z9A-2BTJfIjYgZRUprwCluuWzhEg5Eu-2BQOkYLA-3D-3D) · [Julia La Roche/Thornton](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOi9Dh3aGHMdsJTEsHNGvqMg6qNMNW69ZtBT2kOVjtP3jQlgvfSPr0i18FlIe-2Bso8FdCe6AnmfoaQJeCfdMETO-2F-2BanpgvVqC04Zc5lDGO5ZDYA-3D-3Dl0wg_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmeHBll8erolsuO-2BKtbZZ-2Fx4tlXRDN-2FKcqoiQJnhdHWaz1LEp5HhgCP0nSSftIyHxt9gXUrw79RiV6Yvcw9oMbxNqF2jbybZ5K4cVFeh7DaucdFhDNuTn49fsUTiH9wvNzg-3D-3D)

### The bulls: the last leg was positioning, the Fed won't do as much as priced, and buyers are stepping in

For the first time in weeks, real money managers made the bull case on the podcasts, not just commentators.

* *"The last 25, 30 basis points seems a bit overdone" (Priya Misra, portfolio manager, JPMorgan Asset Management, ETF Edge).* Misra manages money for a living. Her view: "The last two weeks, there has not been a fundamental catalyst. In fact... all the economic data over the last two weeks has been actually slightly on the weaker side." She blames "position capitulation, you know, technical factors, there's negative convexity in mortgages," meaning mortgage investors forced to sell Treasuries as rates rise. "We're now thinking duration, which... we've not been in duration for a while, starts to make sense." On the Fed, she sees "one or two more rate hikes," not the three priced, and an October hike "looks a little hard," so "rate hikes... should mean less for the long end." [ETF Edge](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOj09RnYJfgHm6c9QYu2VewfHoZi4ecC-2BHKpEWgPhN65LmStgqyKJccYhtWz0OdPtUlq31xyaGa0Lc-2BjehLnHOkhUufXHQ8BgN1Y7qDTLpD5Dg-3D-3DHHm8_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmXeMVZMUoMDf5E8N7QxJad6i8JGt1PuIG1nB43W5GiWdtKLcKr-2FqyrcAivRT4BHD1AjfXtQe-2Fkw-2FswVamxca9kD-2FTQoV-2F7bbYVdNn5iYbuTHYSWeCSg9FJwrs-2FBkqYwKVQ-3D-3D)
* *A bond fund going long for the first time (Matt Cole, Strive).* Cole runs high-level decisions on Strive's total return bond fund. He said the fund "for the first time in its history" started buying 10-year Treasury futures "when it passed 5.25%," and "would potentially increase that duration long position up to like 6% on the 10 year," adding as rates rise. Note the tension: he also thinks a "fair market" 10-year yield without official support would be "over 10%," and expects Treasury and the Fed to "step in substantially more." So his bull case on the 10-year depends on more intervention. [What Bitcoin Did](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOhFGGzHqsaeFLEi5SbepjAOKmDurZqoLWYKOuqXjokf2e4E9mHABenPbZ4Vs7M1uUIXigC1WooY-2BDNbP9l9EB9MIojzd5lF-2Bs0XxugKA2Hb6g-3D-3Dej_R_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmT-2BfNXRTxcXK-2Boeb78KcUt7R9xy2xwUrV11-2Fup1fZb8RLdTM0HIBzcvEhFXfcrTrG4kqjjehYasennX985lZ9Z6MLtqU6b-2Bx9ufH5R3AUlQDto93CYuGE-2FlaXIWfngEdeA-3D-3D)
* *The labor market is cooling (Schwab, Rosenberg).* September's 29,000 payrolls, 0.1% wage growth and a three-month average around 50,000 are exactly the "cooling labor market" the bulls need. Colin Martin (Schwab): the report "likely takes away the potential need to aggressively raise rates in the coming months."
* *The dollar says this isn't a fiscal crisis (The Financial Exchange).* Chuck Zotta (advisory host) argued that rising yields "don't signal fiscal apocalypse" because in a real loss-of-confidence episode the dollar would fall. Instead it strengthened about 2.75% over the month. Schwab confirms the dollar index hit its highest since early last year, above 102. Joe Gagnon (Peterson Institute) on Marketplace explained why: high US rates "attract foreign savers," and foreigners are also funding US data centers. [Financial Exchange](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjS5rVnGuePlSc9OQM3lKss2Mg5e0vwSSIJ2QCsx4YZHaqFu5XG0mY9wpSyVPhaCB-2B4FoR0O8-2Bf6Kqc7GtJ7GM33VXCc55f-2FKmjPUnxTcBqqQ-3D-3DTN6Q_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmXIsD3qQ1VPqtQ-2BwUj90ujE6JCGPjKaxS9lvZohuBs5rIJwWLiCG0AR5c-2FA6PoqwB-2FoTf-2B-2Bv-2BX0cvuJy7vojDPEIshRHBwT4wF1b04ClifV5WYQKUx5dX-2FnKBRoxCLfDvg-3D-3D)
* *Term premium isn't the problem, says Howell (Michael Howell, CrossBorder Capital).* On The Wolf of All Streets, the episode summary has Howell saying US term premium has been "flat or falling," so investors aren't yet worried about the debt. Rate expectations are doing the work, which bulls read as reversible. [Wolf of All Streets/Howell](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOj3yDk3wIMebY4LJapRIYeEqtdubAnj5omVIzii05oWcyaw6bCyTqyYbNDaUhKBSvr3fYoiDuzqZ0qhjoaW-2BAF1UpGck0av5omLCRxo-2FA9s2w-3D-3D7b3__7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmYn70v5d5A2QjtNlItE-2F-2FEYsfOc2k3pi22qNzuQbwW2Ie7ZFlbu3QcDlEGgdSLkMt-2BGp19-2FGisrcf0Q6Favh-2FIgWglm5bJPpGQ5oDbNc1c0ttudUH0AXr7WSerxsgYea4A-3D-3D)

*My read:* The bulls had their best week of material in a month, and it came from people who manage money rather than talk about it. But the bears have the scoreboard. The bulls' best argument, softer data and lower hike odds, arrived this week and yields made new highs anyway. If the 10-year and 30-year auctions clear well and yields still can't fall, the Rosenberg "it's just the Fed" view gets much harder to defend.

## Trades in play

Only where a speaker named a specific position:

* *Long 10-year Treasury futures from 5.25%, adding up to about 6%:* Matt Cole, Strive total return bond fund. [What Bitcoin Did](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOhFGGzHqsaeFLEi5SbepjAOKmDurZqoLWYKOuqXjokf2e4E9mHABenPbZ4Vs7M1uUIXigC1WooY-2BDNbP9l9EB9MIojzd5lF-2Bs0XxugKA2Hb6g-3D-3DdnZv_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmaJskmOgjBdzxUFmEUoLyYdzxhl6oqkW2noTiM6Iq0i3K4ISxdE85Lu-2BNN0s9EMihmfA5fJebXiouYZZUTiHZADnM7kTMZwqfoSfwpWbRx7i7l8ViLHSgn-2BOWENL57AduA-3D-3D)
* *Add some duration, and buy 10- and 30-year hyperscaler bonds:* Priya Misra, JPMorgan Asset Management. "You can buy 10-year hyperscaler debt or 30-year hyperscaler debt... the curve is now steep and the spread curve is also steep." Top-quality corporates still yield about 6.5%. [ETF Edge](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOj09RnYJfgHm6c9QYu2VewfHoZi4ecC-2BHKpEWgPhN65LmStgqyKJccYhtWz0OdPtUlq31xyaGa0Lc-2BjehLnHOkhUufXHQ8BgN1Y7qDTLpD5Dg-3D-3D8S85_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmVOj2rOkWqFvRONX2niWJqstG-2BegfaSgRiPuy9dbc3xudb-2BtKfTjm44UvkSYojIQdempL8FV8SD5vP6LyNsX0sDXu-2B5rmH7tKub6OU4XOyNhNPT6H1xVHDrb-2Bz8LJUXQSg-3D-3D)
* *Stay short duration, own investment-grade credit (BBBs around 6.2%, BBs around 7%):* Joanna Gallegos, Bond Blocks co-founder. Same episode, opposite duration call.
* *Value over growth stocks, defensives, gold:* Jesse Felder. Rising discount rates hurt long-duration growth stocks most. [Wealthion](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOgo6zn6AJw-2BdhNebA-2F5aV48VvErS7T7-2FD4y-2FZEgq-2BOhpx3mZQ73R-2B0WQFvvhKzsxORLqq53jHGfHgVo3dGSwR1pJ1pjdmd4XvdF4JUmTrQNvA-3D-3Dc6Bb_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmeYjXbYtPHG2n5lhblmJiyENaXNsWjGvSxThLxbGQg3dnvmk2XPf8rt6UvSuGAB42rptHqBfSjPRFo5UhDm9UORM6f-2Fa-2BjvaY7d5BmVCLPmb5DDnJhzi-2BaGAKtG9mLMM5g-3D-3D)
* *Long energy, short financials:* Chris Whalen, Institutional Risk Analyst, per the episode title. [Julia La Roche/Whalen](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOibjAwXQhch079wl8BwiETPYyA1NMr5G5KMGeXUFJibnRd1nlFfi1iQyl2iN5TijA2eADL5vVEDeS1nW407U28TsQ-2BLAqb61xsoKcmwBMXtyQ-3D-3DI2FM_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmaaVqgfGzhqlr1WquuYJiTw6MXgCsfUCjPcYTbPBmaEYGyq-2B8fItP0cSxi-2BO2gs-2F6jdF-2BXKBScbtLKQk4-2FJVfs8tNIymat1cZ3XKZLzXscNCy3-2FujBpgfcSZYlR4mLavcg-3D-3D)

## Read-throughs

* *Mortgages and housing.* Mortgage News Daily has the 30-year fixed at *7.61%* (Marketplace, Oct 5). Power Lunch (Oct 1) called 7.6% the highest since November 2023. Minneapolis Fed President *Neel Kashkari* gave the cleanest explanation of the year on Bloomberg Talks: "If a trillion dollars is going to go into data center related investment, that capital comes from somewhere. The market is taking it from housing and reallocating it to data centers. The mechanism is higher mortgage rates." Kashkari also pointed to the record gap between the actual 2-year yield (about 4.88–4.90%) and the roughly 4.00% implied by the Fed's own projections, which he partly attributes to an inflation risk premium, investors wanting "a little extra compensation just in case we're wrong." Chris Whalen notes mortgage servicers are cutting jobs and consolidating. Priya Misra: "Mortgages have been getting crushed." [Bloomberg Talks/Kashkari](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOhf1eGza4z6nZvHRWnu2ZHYowtRLP2TONbhNNoDvbiBqPwzjdAXq9dvNS9sdqHYAbtLp8dpJ0IPRKnc-2FaQEkw-2BCfKqqYUboDUVE7QmRmTt3UQ-3D-3DhLbf_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmY-2FVSyDpo7H7abn1KXzY7H-2F6FB3amgecl9dzDOnCleMfcmZeunEzO-2BnusO94E-2BZ4x33C6XyuvN43t9unlJnyMCdOdaBrVQLBgZKqd8qtGG14ADaYKQ-2BWgzd1vcLMBFtulQ-3D-3D) · [Power Lunch](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOhHvR-2Fy-2FG-2BEr92zZJHLRAmVaplX84UyYpNlXEUIey3NLk-2F-2Boe29cKKkLACv0c98w46FzbOmyhio0v4Nd7qbxwBIQKziw31k55cVuPbicm1ZUg-3D-3DU02l_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmcPdsP6BVpN-2FzEIIzJndahovtrYGlgXxSEefebFXJi0YPxNtnATgBNXwc0J2KnW9C0XYvVuF2BbqYcU-2F3B-2BLIVNR8I-2BDdye2VpdrXFgN3DA3do0sObCr74Cx9I8Kx5zeHw-3D-3D)
* *Bond volatility (MOVE).* The MOVE index was at 106.6 on Sept 30, its highest since late March, implying about 6.7bp of daily movement (Options Boot Camp). TFTC described it breaking out of its 60s–80s range into "the 110s plus." Bassman's own index being "north of 100" is the backdrop for Felder's basis-trade warning and Howell's point that the MOVE now matters more than the Fed funds rate, because about 80% of global lending is collateral-based (a World Bank figure he cites). [Options Boot Camp](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOgiml21oi6zZ226bGVKWTLFf8ucexfk2RNXKfPfOEAwc0UQLS7cGxPoWohUtjqcNQKkQrLUjNC6KlFJFHLkDL0ufqYdHsRxVRLK8YWYpFEWmw-3D-3D6hu7_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmb8VBakm-2B2KMc7hysmT7sPH1XeUw79pd69C5-2Bm9jISfE2TGyA2MGHcwkJnx2goCez2Eo0NehvDT4XK1kaTbBF-2F4YbJDAwBIROE4FBlYN8rGcT8wMoxjz7ukjg-2BJ2Hw7pwA-3D-3D) · [TFTC](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOh9QciNSQw1kaDNyUvEOANB1FwV3tKWXanJYabuOAVQt-2BYZJm5IyVwp2E5y8qeKTqgAmEyClFO5ygEk3LCaKW-2BL-2BH6P8JxotqJcqwkYFj11qQ-3D-3DSASG_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmRiIfUM5YuSeK9O20pk6fS0MVhT-2FuHgD9ynyy3x-2B4bRpoHmk6gpFvFGkwt9H6HxQxcXXcgsI9UvJvsQRn7hU-2BF0B73-2BHffppcKWMaF7-2F9lQdvxSsegHIy1eroQv8boVdZA-3D-3D)
* *Credit.* CCC-rated junk bonds trade at "almost a thousand over" Treasuries, a recession-type level, while BB and B spreads sit at historically tight levels (Misra). Tech-sector investment-grade spreads are about 25bp wider this year versus 5bp for the broad IG index. That is the AI-borrowing glut showing up in prices. High-yield spreads rose eight days in a row through last Thursday (Schwab). Saxo's John Hardy highlighted a 2036 Oracle bond at an implied 7.5% versus about 5% for a Treasury of similar maturity. [Saxo](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOiG9XUn2Nk9zED8Pmgqcqwi2XcLcgocNovQgW3oRSNs0C1gKyI9DiAjT55pX-2BTdAvlpg7cVp6LWJ5TGfJuoeqQ8xfJlEY4G73Bs1gZMsrxzBA-3D-3DVjna_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmbPRwVgQS472i69xGCghq5THGjf67Cy6z-2FlSULFbca8KArMOGu6pFNYj2AshlVU22XFmm5hWwsiJx4Ncc9m8YNPUm9czgXGqHZ4u2H6TouMje0gDUu4C-2FI26GR78MwAx2A-3D-3D)
* *Long-duration equities.* So far stocks keep shrugging. The Nasdaq made new highs on Monday, and [Ask The Compound](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjcfTlTDJbRI0TDWcirVZdJE6urTyVeAz6gHkKtEDsfqZf7U4hLhSQyftyAhUql20GI7bVsG67mmQNMEtYgvdmzBQ-2FPcDQv4UhnhGcfYsXi1w-3D-3D0WZq_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmeLtSO4XVPigLX836Xhup-2FBZwqg0Bl8XjELn8v9tYkqE5QRqTZB0TqNybjLXYknMvpL5QvKt1QbtFrs2Z9MHkKOGhaxShCYqDPGJI8RJwkCj3VQmejIALqicvOinpKPMwg-3D-3D) notes the S&P is up double digits for the year while the VIX fell during the rate spike. The cracks are in rate-sensitive areas: the Dow Transports are down nearly 20% from April and staples are lagging (Schwab). Goldman's equity strategist on Power Lunch (Sept 29) attributed about a 14% drop in S&P valuations this year to higher real yields. Bassman's explanation for why stocks hold up is pricing power. Felder's warning is that growth stocks resisting higher rates is what happened in 1999–2000.
* *The dollar.* The dollar index is above 102, its highest since early last year (Schwab), with the euro hit by French debt worries and a Spanish snap election. George Gammon (Rebel Capitalist) flagged an unusual day midweek: the 2-year fell 12–15bp and the 10-year about 5bp while the dollar *rose* and CCC spreads widened. He reads that combination as a possible risk-off signal; Bloomberg attributed the rally to safe-haven buying as French fiscal fears hit Europe. [Rebel Capitalist](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjeF1VCzWv-2FLPXyKQ68z10spGuQNuileIvl-2Fj1CbrN7-2FJa0QakDb-2FCI9UOiFt173ABwuBspoN-2BIfdebKYGHEywqByT6vaM6KXz01c9C3A7H5Q-3D-3DFGca_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmRAfekDYsHrjIEs1Nmqw5YG-2FqYqIFlhNsxU2JTWQ68-2FAIuWKqJz5jsBe0VTmopg-2B0W6amh9hv1ftZ8-2FgCEe7KGmJPPqqRaYXlwRAkel00DmxLO-2B27TspKjimXHec-2FI0HQw-3D-3D)
* *France and the euro area spreads.* France remains the epicenter in Europe. The TFTC hosts put the OAT-Bund spread (French minus German 10-year yields) at *67bp* as of the weekend. That is already above the 59bp peak in the Greek crisis, and it got there in just 23 trading days, against 106 trading days to reach the 2011 peak of 104bp. That figure differs sharply from the "more than a full percentage point" quoted on Unhedged last week. The podcasts don't reconcile the two, so treat the exact level with caution. The direction and speed are not in dispute. Squawk on the Street and [Tom Bilyeu's show](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOgoicJD6tjF3IOTq6Dv3a51bpmabeTlErIEgDJrA9rezsm2uD55pNTe5wlpeGtQxJ5-2FEiFxci2KOvQvtfy8MSW-2F7g6QrElMb9mlovTAxOitvA-3D-3DzHGO_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmTqgMpu6fKyrLHihG1vYrMDGdvv5m3-2FNN4llPZ9Ua4bwhYs50g-2FCJU1Y7-2BDhHYRy4lkELyCdQ7YCAR-2BpGnyb-2BT-2B-2F1obNmwhUEckhSBSHvKjzy9yyHDXPokl-2F3e-2Bgg1ycrw-3D-3D) both tied the French move to riots and political stress.
* *Japan.* [Saxo's](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOiG9XUn2Nk9zED8Pmgqcqwi2XcLcgocNovQgW3oRSNs0C1gKyI9DiAjT55pX-2BTdAvlpg7cVp6LWJ5TGfJuoeqQ8xfJlEY4G73Bs1gZMsrxzBA-3D-3DMLYa_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmd4w5RpCp-2FmmvFgay-2BveIMEsiLGJ9qQTRZZ6oe-2BaVmeWfr6OPE50gLTVaVpLiMWwgDG4FRNdbWyeeMGtKHEZkl9lblBEr30Esa13HyBqQZIKOje9tpcbo7ZRlee1tCWq7g-3D-3D) Hardy reported a strong 40-year JGB auction, with speculation that Japanese investors are finding domestic long bonds attractive again. That matters because Japanese buyers have long been a key source of demand for Treasuries. Japanese officials, including currency diplomat Mimura and Finance Minister Katayama, stepped up verbal warnings about the yen, and Katayama said the US and Japan are on the same page on intervention. On a separate note, Tom Bilyeu's show claimed JGB yields have risen for a fifth straight quarter. That is commentator-sourced and unverified here.
* *Foreign demand.* China's Treasury holdings fell to the lowest since 2008, per government data cited by Schwab. Jeff Christian (CPM Group, gold analyst) countered on The KE Report that foreigners hold a record $9 trillion of Treasuries and that bid-to-cover ratios (bids received versus amount offered) remain normal. [KE Report](http://url7324.matterfact.com/ls/click?upn=u001.idHmPrr2Geh7KYLAsTy7NkrIVb-2FgA4pmf2rMXQwGcOjothTUAv-2BOqyYLIQyj242i9wqwEX72soHJpirxP377DBSCH0EYcyDtCcAEeciobtLux45vakZ-2F-2BcBnAuu-2F7LhJDReGxZ6WqUYNm7-2FKu1-2FD6Q-3D-3D-7Tn_7mLGwmUci-2BLaXswv9WX1yTgqn3Wad-2FotHhzHgSNAZbWZWDW-2BAwI11H7Au6nfLbZ0DoSmwL6pE6GUH2nbwVrEmdHBM8nWEqLM-2B9ictTt1HRUaKMF-2FdiQPf3-2Bn7hxeNlXEY8ODTIh0lTjehDP9-2Bls-2Bq-2Fh3V1gyIwAqt3UeySplbO9vt-2FKkfL-2FB8MQ7K0QPYmAPHyQCYhswALoTe3wxxj1OKQ-3D-3D)
* *Gold.* The debasement trade is split. Michael Howell argues "the real monetization in the West hasn't started yet." China, not G7 money-printing, is driving gold, but he says to own gold and crypto as hedges against "a permanent or progressive devaluation of paper money." Taylor Kenney (ITM Trading, gold dealer) argues gold is "falling first" in a global debt crisis. Bassman: "I like gold." Felder's host noted that higher rates, a strong dollar and high oil have been a drag on gold, and that people "sell their winners when they're under stress."

## What changed vs. last week

* *The 10-year made new highs:* 5.22% on Sep 28 → closed the week at 5.28% (intraweek highs near 5.31–5.34%) → *above 5.33% Monday*, a 24-year high. The 30-year closed the week at 5.63%, with highs near 5.69% (Schiff's figures).
* *Hike odds collapsed but yields didn't care.* October hike probability fell from ~70% to ~24% after the jobs report. Last week the bond selloff tracked Fed expectations; this week it broke free of them.
* *The buyback story ended.* Last week the buyback was undersubscribed. This week Guha says Bessent "backed off," and Bessent says he "can't control the bond market."
* *Real-money bulls appeared.* JPMorgan Asset Management's Misra and Strive's Cole both said they are starting to add duration around 5.25%. Last week the bull case was mostly Vanguard's "add duration" comment and commentators.
* *Oil relief didn't help.* Crude fell almost 2% Monday on better Gulf flows and an EU proposal to release diesel stocks, yet yields rose. Schwab's phrase: the oil-yield relationship "appears to be decoupling."

## The week ahead

* *3-year auction today; 10-year Wednesday; 30-year this week.* The key test of whether buyers show up at 5.3%.
* *FOMC minutes Wednesday:* how split was the Fed on the September hike, and what does it take to hike in October?
* *September PPI next week; September PCE later this month.*
* *Big banks report a week from today:* the first read on how higher rates are hitting lending, mortgages and credit quality.
* *Iran:* Power Lunch relayed a Wall Street Journal report that a third carrier group and up to 10,000 more troops are heading to the region, with renewed strikes possible after the Nov 3 midterms. Oil is the one catalyst both bulls and bears agree on.

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