Bessent Doubled Buybacks, Yields Went Higher: A Headache For Warsh At Jackson Hole

Geneva Investor 3.81K Followers Follow Summary The Treasury doubled its long-end buyback cap on Wednesday, and the 30-year fell 9 basis points, but the entire move was gone within a day. Treasury Secretary Bessent now has two open requests that only the Federal Reserve can grant, and Fed Chair Kevin Warsh delivers his first Jackson Hole keynote on Friday the 28th. Warsh's stated program, a smaller balance sheet concentrated in short maturities plus a rewritten 1951 Accord, pushes long-dated yields in the opposite direction from what the administration wants. The symposium's payments theme is relevant, though stablecoin demand lands inside three months and its growth has stalled alongside crypto this year. I remain long U.S. equities and reiterate my buy on the S&P 500. A variable claim on nominal cash flows looks better to me than a fixed coupon from an issuer whose own debt manager cannot hold its borrowing cost down for a single session. Getty Images On Wednesday afternoon, the U.S. Treasury announced it would at least double the size of its liquidity support buyback operations for securities, taking the cap from $2 Billion to at least $4 Billion per operation. The 30-year yield ( This article was written by Geneva Investor 3.81K Followers Follow I write about Macro and fundamentals, with the (painful) awareness momentum and sentiment are what really matters. That’s why I never try to time the market and I only buy stocks if I am willing to hold them for at least 10 years. When it comes to fundamentals, everybody knows the market is forward looking, but few understand what that means. I don’t look at a P/E number and decide to buy if a stock is “cheap”. I see the market as literally just the meeting point between demand and supply and I always try to understand what it sees in a stock beyond the numbers. This often implies trying to understand sectors, industries and long term growth trends. My approach requires ingenuity, curiosity and a good dose of naivete, as well as being comfortable with (sometimes) going against the current.I am based in Geneva, Switzerland (hence my SA name). Friend "Rex Investing" is also a contributor to Seeking Alpha. All opinions and analysis are exclusively my own.You can follow me on Twitter @ x.com/GenevaInvestor. I am also on medium.com/@genevainvestor. Analyst’s Disclosure: I/we have a beneficial long position in the shares of VOO, QQQ either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.