The US Treasury conducted a $6 billion bond buyback on Wednesday, triple its usual size and the biggest such operation in years. Despite the scale of the offer, yields rose instead of falling: the 10-year rate hit 4.84% and the 30-year climbed 5 basis points to 5.307%. This operation does not reduce the $40 trillion national debt and is not quantitative easing, as the Treasury funds it by issuing more short-term debt. Leading investors like Pantera Capital’s Dan Morehead and Stanley Druckenmiller criticized the plan, with Druckenmiller stating that governments defending prices against fundamentals always lose.
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