The Fed has succeeded in propping up the bond market (ie keeping interest rates low) long enough to get the infrastructure bill passed. Once the final Democrats dream- the $1.75T social spending bill- is either passed or scrapped, I believe political pressure on the Fed to keep printing the money declines. At that point the odds of a collapse of the bond market surges. Note the recent treasury auction described as a Bond Auction Disaster’ is a sign that the Fed’s ability to delay the interest rate surge is weakening.
thanx, Lisa
Great article Bob!