Interest rate cuts are coming, will the bull return?
Attention everyone! The latest data from the U.S. Treasury shows that the two-year Treasury yield is surprisingly being pressed down by the ten-year yield, a peculiar phenomenon reminiscent of large-cap stocks falling harder than small-cap stocks in the equity market—a typical economic warning signal.
Bessenet has finally broken through the window paper: if the Federal Reserve continues to pretend to sleep, the mountain of U.S. debt will eventually crush the financial market.
Take a look at these shocking numbers: the scale of U.S. national debt has surged to $36.5 trillion, with interest payments accounting for nearly one-third of fiscal revenue.
In layman's terms, it would take the entire population three years of not eating or drinking to pay off the interest. Even harsher, the Trump administration set a hard deadline for the Federal Reserve—to cut interest rates below 3%, or else annual interest payments would exceed $2 trillion.
Yet, the Federal Reserve is still playing a balancing act, publicly claiming to control inflation while firmly pressing the interest rate cut button. This operation is akin to firefighters watching a fire without extinguishing it, busy instead sealing the fire extinguishers.
Bessenet's maneuver is clearly a palace coup: either proactively cut interest rates to relieve debt pressure, or wait to be voted out by the market.
The most ironic part is that while the Trump administration calls for interest rate cuts, it simultaneously imposes tariffs aggressively. This is like pouring oil into a fire with one hand while trying to put it out with the other—ultimately, the hardest hit will be the domestic economy.
It is advisable to keep a close eye on two indicators: if the ten-year Treasury yield falls below 4%, buckle up quickly; if the Federal Reserve continues to delay rate cuts, the U.S. stock market may likely experience a high-altitude dive.
The market now resembles a pressure cooker, ready to explode at any moment, so brothers, don’t play the role of the bag holder!
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