A Liquidity Masterclass: Preparing For A Credit Cycle Downturn | Darius Dale
Inflection Point
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The Fed's Mandatory to Have Moderate Long-Term Interest Rates
The Fed has an explicit dual mandate, right? They've got price stability. They've got unemployment But I would argue they have a third mandate that actually supersedes both of those which is making sure that the market for treasury stays liquid. When we saw the Fed bring out their kiwi bazooka back in 2020 March of 2020 right there was disruptions in the treasury market and if the treasury market stopped trading like everything else Kind of breaks underneath it. The number one thing that kills the long the bond market is not perceived illiquidity. It's inflation unbridledUnward inflation expectations You know right now we let we have term premium if you look at the 10 year
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