Posted inAnalysis

Yellen’s steeper yield curve lets banks finance the huge US budget deficit

An off-hand comment by Treasury Secretary Janet Yellen that “issuing longer-term securities certainly seems to make some sense” February 22 aggravated the sharp sell-off in long-term Treasury securities and widened the differential between shorter and longer maturity bonds. That’s a man-bites-dog story, because central banks engaged in monetary stimulus usually want to keep long rates […]