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As you wrote:"Read it with a pinch of salt". Yep, that is true!!
While the article raises an intriguing argument, it leans heavily on speculation about deliberate market manipulation by the administration. The core idea—that lower bond yields would benefit the government’s refinancing efforts and potentially lead to Fed rate cuts—is plausible, but the mechanism proposed (intentionally crashing the stock market) is unlikely and lacks evidence.
A more balanced interpretation is that broader macroeconomic trends (e.g., slowing growth, moderating inflation) are driving bond prices higher and yields lower, which could benefit the government’s refinancing efforts and create a favorable environment for risk-on assets in the longer term. Investors should focus on these underlying trends rather than speculative claims about market manipulation.
Looking at the rationale:
"Falling yields mean rising bond prices. If the economic outlook weakens or inflation moderates, demand for Treasuries could increase, pushing prices higher".
Conclusion for a trade: Going long the 10-Year Treasury Note Futures (ZN) or 30-Year Treasury Bond Futures (ZB) by using technical levels (e.g., support/resistance) or macroeconomic catalysts (e.g., weak jobs data, dovish Fed statements) as entry points. After this, monitoring inflation data and Fed communications, as hawkish surprises could reverse the trend, is needed. Stop loss levels have to be defined in this scenario like in any other scenarios!
Or on the other hand:
"If inflation remains sticky or the Fed signals a delay in rate cuts, bond prices could fall (yields rise)".
Conclusion for a trade: A hedging strategy or a contrarian play by shorting the 10-Year Treasury Note Futures (ZN) or 30-Year Treasury Bond Futures (ZB) would be an answer. Entry points at resistance levels or overbought conditions. Being prepared to exit quickly, if economic data turns dovish, should be considered.
Considering to trade (Long or Short) other future markets like indexes (ES long and NQ short) or commodities (GC and CL long and ZC and ZS short) in the current environment requires surely a clear understanding of macroeconomic trends and careful risk management. (An other huge topic).
I get the overall idea that this may be orchestrated (although I don't completely back it), and my question remains: to what end? What is the benefit of a forced recession?
The only idea mentioned in the article is
Which is dubious in my mind. The US economy has yet to prove that supply-side stimulus (trickle down economics) works for its ecosystem. But maybe thats the communicated intent, with the underlying motive to be profits to those who are considered supply-side (cuts for business owners, less restrictions on buyouts, and less FTC monopoly regulation)?
That's quite dense for only a few sentences, and I guess with any opinion its
1) Do you agree with their evaluation of the situation?
2) Do you agree with their plan?
3) Do you think that their plan with have their desired outcome?
Based on the article, my thoughts are:
1) Do I think this market downturn is intentional?
No, but any good politician never lets a good crisis go to waste so they will capitalize as much as possible
2) Do I think after a downturn we can use Fed rate cuts and supply-side stimulus from tax cuts and deregulation rebuild the economy?
Hard no, this seems like an unproven idea
3) That cuts and deregulation will revive the economy without government spending?
No, and I feel like thats the whole lesson we learned during the early 1900's - a few large companies have enough sway to squash competitors without benefit to consumers, and with a capitalistic society you need to spur spending by consumers to get a health economy (New Deal anyone)
Let me know if I missed something else about this narrative, I've heard it a few times now this month but havent read too much into it
This is an excellent and thoughtful response, and it raises critical questions about the motivations, feasibility, and potential outcomes of the ideas presented in the article.
You asked if you missed some thing else about this narrative?
Well, who I am to tell you what you missed. So take it with a pinch of salt when I try move on with the discussion as your analysis is thoughtful!
What about the following points with out going deep into it?
Evaluation of "Other Fields" to consider:
- Global Context in short:
Global economic trends (e.g., trade tensions, supply chain disruptions) might influence the effectiveness of domestic policies.
- Political Realities in short:
Political polarization and institutional constraints might limit the feasibility of certain policies (e.g., large-scale government spending).
I think that the following interview between "Ben Norton" and "Professor Michael Hudson" fits very well here. While it has a political component to a certain point, the majority of the interview is focused on the economic aspects that arise from it and examines these in depth. Topic which is analyzed:
Donald Trump’s tariffs could destabilize the global economy, warns economist Michael Hudson. US protectionist policies could cause financial crises, as many currencies depreciate and countries can't earn the dollars needed to pay their foreign debts. Ben Norton hosts the interview.
I do appreciate your follow-up, however, since the video is almost 1 hour long, to avoid me going through it to decide whether and which segments might have political content, it was easier for me to just remove it.
I do realise the topic is sensitive and it can become a slippery slope, especially if there is anything that can be construed as 'polarizing'.
I understand your concern, as I even wanted to mention in the above post that if the thought arises that there is perhaps too much political content, the video should be removed.
Anyone who is interested can now find out more about the topic, addressed by those two, from an external source.
