I hope @dampedspring is wrong, but fear he might be correct. ---- The Quarterly Refunding Announcement (QRA) comes on Wednesday morning (a few hours before the FOMC announcement/Powell presser), when Treasury gives us the mix of Bills, Notes, Bonds, and TIPS they will issue next quarter. Trump has suggested the Treasury stop issuing 10-year notes and 30-year bonds at these yields and instead borrow everything in Treasury Bills. Then, when Trump replaces Powell, and the new Fed Chairman cuts the funds rate to 1%, the Treasury can refinance all those bills at much lower rates, saving hundreds of billions in interest costs. Doing this would be a financial disaster. The post below assumes Bessent completely understands this and fears Bessent will do what Trump tells him, regardless of how ill-advised that might be. ----- The mix of Treasury issuance is essentially in balance with the demand for that issuance. If the QRA on Wednesday indicates that the Treasury will issue trillions more in bills (a massive change), where will those additional bill buyers come from? They will have to be found immediately because the issuance change is coming in the next 90 days. A supply/demand imbalance will have been created. The solution is to adjust the price. That’s a nice way of saying Treasury Bill yields will soar to entice more buyers to step up to purchase this new, sudden supply. Remember, there are no bad bonds, only bad prices. This will drive up repo rates in bank financing costs and throw the entire financial system’s plumbing out of whack, potentially creating a financial crisis.