The Treasury Just Lost Control of the Bond Market
The show opens on the worst stretch for government bonds in decades, with Japan's 10-year yield at 3% for the first time since 1996 and long-end yields retracing past where they sat before the Treasury announced its buyback program two weeks ago. Jackson makes the case that bond investors are finally calling the bluff, and Brian argues the interventions to date are nowhere near enough and that another balance-sheet expansion event is the only exit. Michael brings the chart that frames the week: since 2014, inflation-adjusted, gold is up 145% while bonds are down 20%, and he pushes on why the 60/40 doctrine survives at all when the risk-free asset loses money in real terms once inflation is priced in. Then the counterweight: $3.5 billion flowed into US spot bitcoin ETFs in August, the biggest month in over a year, bitcoin closed up 25% for its best month since November 2024, and iBit is now outperforming Vanguard's S&P 500 fund since inception. The back half covers 21 banks including Goldman, Bank of America and Deutsche announcing a joint dollar stablecoin planned for 2027, a data breach exposing 153 million driver's licenses, and data-center developers cutting $10,000 checks to residents.
Chapters
00:00 - Housekeeping, live events, and the fantasy draft 05:50 - The worst stretch for global bonds in decades 07:53 - Brian: the interventions are not going to be enough 10:01 - Gold up 145%, bonds down 20%, inflation adjusted 11:29 - Hooray for the bond market: what the mainstream is told 14:29 - Why 60/40 survives when the ballast loses money 18:28 - The hard asset renaissance and the next allocation shift 20:06 - Bitcoin as the fire alarm on the print that is coming 22:30 - $3.5 billion into Bitcoin ETFs, the best month since 2024 28:02 - Brian: the backdrop has changed, this is a new regime 28:24 - What is already breaking: housing, auctions, layoffs 32:38 - iBit is beating the S&P 500 fund since inception 34:55 - 21 banks announce a joint dollar stablecoin for 2027 44:00 - Why the system repurposes the wheel around Bitcoin 49:57 - Single point of failure: 153 million licenses exposed 56:22 - Uber cuts 10%, and data centers pay residents $10,000 1:04:57 - Why companies may start holding gold on the balance sheet
