Wealthion · Thursday, September 10, 2026
Michael Green discusses Treasury Secretary Scott Besson's August intervention in the forex market and the announced Treasury buyback plan. He posits that the market for long-dated bonds is not lacking buyers, but rather the traditional buyer behavior has shifted due to algorithmic trading in passive bond funds.
“Unfortunately, what I think we're largely seeing right now is a global phenomenon in which duration is selling off because there is an absence of the marginal buyer of the longer dated bond.”
“The marginal buyer today is actually a passive bond fund and that passive bond fund ironically doesn't care about any of that.”
“Perversely, that means that a passively weighted bond index fund is going to buy them in proportion to their market capitalization.”