Know Your Risk Podcast Conversation with Stephen Miran - August 9, 2024
Aug 8, 2025
Stephen Miran, a former nominee for Fed Governor now at Hudson Bay, shares his insights from a career straddling investment management and public service. He delves into treasury issuance strategies, revealing how they reflect and influence interest rates and inflation. The discussion offers a nuanced view of the labor market's dynamics, emphasizing new workforce entrants amidst rising unemployment. Miran critically examines the Fed's policies and their effectiveness, raising vital questions about the durability of economic health and the implications for future growth.
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What Activist Treasury Issuance Is
- Miran and Roubini define Activist Treasury Issuance (ATI) as Treasury deviating from normal issuance by issuing far more short-term bills.
- They argue this shift has persistent market effects similar to central bank interventions.
Why Bills Act Like QE
- Miran explains QE removes duration risk by swapping long bonds for reserves, lowering market interest rate risk.
- He says Treasury's large issuance of bills replicates that effect by creating money-like substitutes instead of long-rate risk.
ATI's Size Is Economically Significant
- The paper estimates ATI's stimulus is roughly equivalent to an $800 billion QE program.
- Miran argues that scale effectively offset about 100 basis points of Fed tightening last year.