Bonds bubble about to pop? 10y govt bond yields on both sides of the Atlantic have jumped to critical levels. This is not what you want if you're in the business of selling debt.

Bonds bubble about to pop? 10y govt bond yields on both sides of the Atlantic have jumped to critical levels. Could break out every minute. Japan’s yields alone remain artificially depressed by BoJ’s Yield Curve Control.

@Schuldensuehner


Macro Alert

Quick reminder of the main premise: The world is so indebted courtesy of artificial low rates that rising rates will present a clear and present danger to the sustainability of economic growth in the long term.
Hence a couple of key data developments in recent days.
Firstly the 10 year has now broken above its long term trend:

Every time the 10 year has come close to its trend it produced a rejection in many cases because the Fed had to intervene as stock prices collapsed. We saw it in 2000 and 2007, but also in the early 1990s.
So what you say, the 10 year is still historically low. Oh yea?
Watch this:

Interest payments on debt for the US government flew to a record high in Q4. And no, this is not only driven by increased deficit spending ( and much more to come), this is simply a reflection of the Fed having raised rates by the tiny amounts they have implemented so far:

 

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