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Treasury Secretary Scott Bessent could draw on the Treasury General Account, a reserve sources say holds close to $1 trillion, to fund a bond buyback program.
The move would give the Treasury what those sources described as considerable firepower to push long-term yields lower.
The risk is that a reserve of that size deployed into bond markets is not a surgical instrument, and the second-order effects reach well past any targeted yield level. The case for TGA deployment is mechanical.
Bond buybacks reduce the outstanding supply of longer-dated paper in the market, pressing long-term yields down through direct demand rather than through rate policy.
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