Is the federal budget deficit getting too big for the bond market to fund without yields moving higher? That seems to be a growing concern in both the bond and stock markets. In the past, bond yields were determined mostly by the Fed’s response to inflation, which is moderating; supply and demand didn’t matter much, but they may now. Today, we examine why this period of deficit widening is different than past ones. … We also examine two scenarios that could unwind the inversion of the yield curve—one bullish, one bearish—and recap data supporting both.
Below is exclusive early access to Dr Ed's Webcast for paid members. This post and video will open to the public on a later date.