Former Federal Reserve Board Member Kevin Warsh's opinion on the importance of the 10-year Treasury rate is challenged in an article by Jonathan Levin in The Washington Post [a9a98cc1]. The article argues that government income streams, such as Treasury bonds, are not essential for the health of the global economy and markets. It suggests that central planning and government spending hinder the allocation of resources by substituting market knowledge with political decisions. The article also challenges the notion that the 10-year Treasury rate is important for benchmarking and setting interest rates, arguing that markets function best without government intervention. Instead, the author concludes that the 10-year Treasury rate is merely a market signal of the American people's productivity and excessive tax revenue generation. The article questions Warsh's narrow perspective on the importance of the 10-year Treasury rate and emphasizes the unseen consequences of government debt [a9a98cc1].
This contrarian view adds an interesting perspective to the ongoing debate about the safety and importance of Treasuries. While some experts express concerns about the risk of bubbles and the increasing yields on Treasuries [ef319c6a][335a0ea2]][this article challenges the notion that Treasuries are crucial assets for the global economy. It highlights the potential negative effects of government intervention and emphasizes the role of market signals in resource allocation. The article invites readers to consider alternative viewpoints and think critically about the role of Treasuries in the financial system [a9a98cc1].
The article 'FOMC increasingly irrelevant in the 'wonderland' economy' by Gary Tanashian on Kitco News [3950d02c] discusses the increasing irrelevance of the Federal Open Market Committee (FOMC) in the current US economy. The author compares the state of the economy to the fantasy world of Alice in Wonderland, where nothing is what it seems. The author emphasizes the need for active risk management in the current 'everything bubble' and highlights the absurdity of FOMC meetings. The article also mentions the mountain of debt that the economy is built upon and the role of both fiscal and monetary policy in capitalizing on this debt. The author references an article by John Rubino that discusses the theme of debt leverage and the ticking clock of the economy. The article concludes by stating that the bond market is rebelling against debt excess and warns about the dangers of Ponzi schemes. The article provides a contrasting perspective to the importance of the 10-year Treasury rate, highlighting the role of the FOMC and the risks associated with the current state of the economy [3950d02c].