As it is currently enacted - it can be. It can also be a bad trade actually. If inflation persists, the buying these long dated bonds might have been a mistake, as the Treasury would have over-payed for them.
In theory, buying long-dated bonds by issuing short-dated bonds, can be a positive approach if you believe the market is making a fundamental mistake in forecasting how inflation will develop. I’m skeptical Bessent knows better than the market.
Isn’t this circular financing? Just like the AI tech companies.
As it is currently enacted - it can be. It can also be a bad trade actually. If inflation persists, the buying these long dated bonds might have been a mistake, as the Treasury would have over-payed for them.
In theory, buying long-dated bonds by issuing short-dated bonds, can be a positive approach if you believe the market is making a fundamental mistake in forecasting how inflation will develop. I’m skeptical Bessent knows better than the market.
People joke that the Fed is the money printing machine while this time it is the treasury