30Y Treausry Yields 20260826

How Warsh Can Solve the US Debt Crisis With Just a Few Words at Jackson Hole!

by with No Comment AssetsBehavioral SentimentCentral BanksCharles NajjarCorporateEconomyEquitiesExclusive ContentFeatured HighlightsFinancial InstitutionsForexInvestingRisk ManagementUncategorized

A Roadmap for Fed Chairman Kevin Warsh to Rescue U.S Debt

Many think the market decides interest rates.

Wrong!

The Fed – and only the Fed – has full control over interest rates, all over the curve!

We just need to have the right person on board.

During the European crisis in 2011, speculators all around the world were betting that the Eurozone would explode and that the EUR would collapse under the weight of government debt that had started with Greece and spread to other countries that were shamelessly labelled “PIGS,” adding insult to the speculative attack.

Trichet, at that time chair of the ECB, seemed totally clueless, afraid to take any “unconventional” step, even at the risk of seeing the entire European financial system go bust.

The crisis seemed unstoppable… until Mario Draghi stepped in, replacing Trichet.

With just one magical statement (“the ECB will do whatever it takes to save the Euro. And believe me, it will be enough”) Draghi implied that he was ready to buy government bonds from European countries, even though such action was considered at the time to be “against the ECB’s statutes” and outside its mandate.

By going against the prevailing market narrative, and knowing very well the economic strength of the Eurozone, Draghi forced the market to follow him.

The speculation against the Eurozone stopped almost instantly, and European government bond prices recovered without the ECB even being forced to intervene!

30Y Treausry Yields 20260826

U.S 30-Year Treasury Yields Chart From 1988 until 26 August 2026

Today, the U.S is in exactly the same position!

A massive speculative attack is being waged against U.S debt (probably led in part by the crypto industry in an attempt to justify the “value” of its virtual tokens), with “inflation” suddenly becoming the ultimate beast.

Like Trichet at the time, the weak Powell got driven into the trap of raising rates abruptly on his own government, forcing it to pay more than $1 trillion in yearly interest, a massive and unnecessary injection of liquidity that is itself… inflationary!

In today’s world, driven by massive debt, raising interest rates on governments is INFLATIONARY!

Now that Powell is almost gone, all hopes lie on Warsh’s shoulders.

He can save the U.S from the current debt crisis with just a few words, exactly as Draghi did for Europe.

Warsh completely missed his first intervention a month ago. Instead of showing the market who’s boss, he showed total febrility.

Fearing being labelled a “Trump puppet,” he insisted on the 2% inflation target – an absurd threshold that nobody really knows where it came from – and claimed that “the economy is robust”… while we all know it is not!

Then he totally capitulated to the market by saying that he would “listen to the market” to determine where rates should go. The worst thing any Governor could ever say!

That’s how long-term yields exploded to levels not seen since 2007, and forcing Bessent to intervene to limit the damage.

We are now just one day away from the Jackson Hole Symposium.

Warsh can now either save the U.S or send it into Armageddon!

Every word he says could change the entire picture.

He simply has to focus on the right narrative:

  • Current inflation is geopolitical and driven by supply shocks. Raising interest rates has zero impact on such inflation.
  • The 2% inflation target is NOT an absolute figure. A 3% inflation rate should be acceptable when the economy is at risk.
  • Signs of recession are looming, with the labor market under pressure, rising bankruptcies, and record rates of defaults on credit cards and car loans.
  • Forcing the government to inject more than $1 trillion through interest payments is itself inflationary. Raising interest rates to fight inflation is counterproductive at such a high level of government debt.

If Warsh is capable of highlighting these arguments, yields will drop instantly without any intervention from Bessent.

Then the Fed can start decreasing interest rates gradually, with the market accepting whatever rate it sets.

What if Warsh deliberately gave a disastrous speech a month ago, taking a tough position against what Trump appointed him to do and allowing the market to drive rates to extreme levels… only to radically change his position following the recommendations of the task force he appointed?

This way, he would have absolved himself from being labelled Trump’s puppet while executing exactly the plan of reducing interest rates.

We can therefore suspect that he will take the opportunity at Jackson Hole to present the first findings of this task force, which could include, among other things:

  • A questioning of the 2% inflation threshold, especially when the economy is at risk of entering a deep recession.
  • Stressing that inflation comes mainly from geopolitical issues and supply shock. Fighting such inflation with high interest rates is totally inefficient.
  • A highlight of the absurdity of raising interest rates on the U.S government and forcing it to inject $1 trillion in interest payments – an unnecessary injection of liquidity that is itself inflationary.
  • The necessity of coordinating with the Treasury Department to fight inflation where it hurts the most, through subsidies, tax relief, and other targeted measures, while primarily fighting “greedflation” through higher profit taxes on specific industries.
  • A warning about the increasing risk of recession, with record numbers of corporate bankruptcies, credit-card defaults, and a deteriorating job market.

Warsh has a unique chance to prove that he is the right person for the job by rescuing the U.S from the massive speculation against its debt, exactly like “Super Mario” did when he saved Europe from collapse in 2012.

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30 Year Govt Bonds 20260820

Bond Yields: The Wheel Has Not Been Rediscovered

by with No Comment Behavioral SentimentCentral BanksDataEconomyExclusive ContentFeatured HighlightsFederal Reserve, Interest RatesFinancial InstitutionsForexRisk ManagementRobert PetrucciUncategorizedWorld

Unintended Consequences: USD and Gold will now get their turn in the casino because of Scott Bessent's QA

Treasury Secretary Scott Bessent’s decision to begin injecting money into U.S Treasuries needs to be looked at by Forex traders. There is reason to suspect USD centric weakness may prevail moving forward. 

Yesterday’s bond news regarding Bessent’s actions to fight the higher yields in U.S 30-Year Bonds has brought rates down from almost 5.28% to nearly 5.18% as of this morning. 

30 Year Govt Bonds 20260820

U.S 30-Year Bond Yields 5 Day Chart as of 20 August 2026

Perhaps market results and dynamics can be quantified as math within a game, but at the end of the day it is behavioral sentiment that drives market forces and the way financial institutions react. Psychology can be looked at as the reaction via the marketing/influence of policy positions and presentation.

We have been down this road before. The decision to announce a round of quantitative easing yesterday via Treasury/Fed intervention should be compared to what the same team did a couple of weeks ago regarding its powerplay with the Bank of Japan in order to make the JPY stronger. We are now in a definite cycle in which government institutions are battling investors to stop momentum in certain assets when policies have gone bad.

The wheel has not been reinvented. It may seem like an unfair advantage to traders betting against government policies that are interpreted (correctly) as being misguided or unwise, but these are the rules of the game. Large players who have been betting on U.S Treasury yields to increase were likely not happy yesterday, but they should have known the U.S government would not sit idly and simply allow an implosion of the financial system to occur.

Having said the above, now we can look towards the realm of unintended consequences. The U.S Dollar Index dove yesterday with USD centric weakness and gold soared. And as long as folks refuse to buy U.S long-term Treasuries on the cheap and demand higher interest rates to protect their investments the potential of further unintended consequences will occur. 

Scott Bessent handled the situation perhaps correctly yesterday, but he is dealing with symptoms and not the cause of the virus. A lack of clarity clouds global central banks and monetary policies connected to their interest rates. Inflation concerns persists and so does the debate regarding how to battle this illness.

The U.S Fed and Chair Kevin Warsh have a major task ahead regarding interest rate policy.  And government’s – particularly the U.S – have to decide if they can actually stop the bleeding. For the moment this appears to be a tall order because by injecting digital money into U.S long-term bonds the U.S is spending money that it really doesn’t have, except to say that this is a game of chicken in some respects and financial institutions could be faced with the dilemma of cutting off their nose to spite their face. Where are Friedrich Hayek and Milton Friedman when you need them?

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Singapore Dollar 20260818

Forex: Compressed Tight Realms Signaling Nervous Reactions

by with No Comment Behavioral SentimentCentral BanksCommoditiesEconomic CalendarEquitiesFeatured HighlightsFederal Reserve, Interest RatesFinancial InstitutionsForexInvestingRisk ManagementSpeculatorsUncategorized

Sentiment Storms as Financial Institutions Remain Unsure about Outlooks

Price action in the USD/SGD has continued to demonstrate a rather significant turn downwards since the last week of June. The price of the currency pair is near 1.27800 as of this writing and is traversing near values seen the 1st of June and towards the end of the first week of March. Importantly, the USD/SGD has also seen recent lower depths and was below 1.27000 in the second week of May.

The USD/SGD traversed deeper ratios in late January when the 1.26000 vicinity was challenged and these levels were sustained until the middle of February. On the 26th of February the USD/SGD was near the 1.26500 mark. Now that the above numbers have been established, let’s discuss why this is potentially important for Forex traders as developing trends surface.

The past few years of trading have seen a compression of Forex deviations, in other words the FX market has grown more tame. However, the Bank of International Settlements (BIS) now reports that over 9.6 trillion USD in value is traded daily. This is a stark increase compared to 2022 when Forex saw an average daily market around 7.5 trillion – meaning there has been a 28% increase over the past four years.

Singapore Dollar 20260818

USD/SGD One Year Chart as of 18 August 2026

The scope of volume is presented not to cause fear, but to show Forex traders what is at stake and the size of the marketplace and its potential for sudden jolts of volatility if it is established. 

Turning our attention to the new Fed Chairman Kevin Warsh and his preference to not give concrete forward guidance is important. U.S Treasury yields are dangerously high (the 30-Y yield is near 5.31%), and the military conflict between Iran and the U.S  continues to fester. Threats remain on the horizon which need observation, insights that prove correct regarding how these bits of information will influence the Fed Chair and the impact on the USD could prove significant for financial institutions.

Large players have reasons to be critical about a lack of clarity and this might spark more choppiness in Forex – even though value realms are said to be in a compressed state. This opens the door for technical traders who may have a better gauge on existing behavioral sentiment of the Forex markets compared to fundamental traders who have too many tea leaves to interpret which are moving rapidly as the cup gets shifted. Technical traders may have a good sense of where algo trading is directing its velocity per current Forex sentiment. 

While some analysts make a case for an increase to the Federal Funds Rate because of inflation concerns, what happens if they are wrong? And what if large players are now discounting their initial fears regarding higher interest rates and are actually starting to position themselves for the Fed Funds Rate to remain the same or be lowered in the mid-term? Is this one of the reasons why the USD has become weaker recently?

What if the new Fed Chairman Kevin Warsh proves stronger than people believe and has the ability to talk lower interest rates into reality? The U.S Treasury faces a huge and expensive task trying to pay off the yields of the high flying 10-Year and 30-Year bonds. What if Treasury Secretary Scott Bessent who has a solid relationship with Fed Chair Warsh proves influential? Read AMT’s Charles Najjar’s article on his thoughts about why the Fed should aim for a 2% Fund Rate: https://www.angrymetatraders.com/why-the-us-fed-should-lower-interest-rates-to-2/

Yes, the Middle East situation remains troubling from a mid-term economic viewpoint regarding the implications on WTI Crude Oil prices and ancillary energy costs globally. Inflation must be battled, but is raising the Federal Funds Rate going to help decrease the cost of energy or lessen its demand? Mostly likely no.

US Dollar Index 20260818

U.S Dollar Index One Year Chart as of 18 August 2026

The gold market has started to show signs of price velocity the past couple of weeks. The precious metal is trading near $4,395.00 as of this writing. Investors with a long-term window and troubled perspectives about the health of the USD have plenty of reasons to be more comfortable holding gold compared to staying in cash. 

U.S equities have been doing well via indices, but nervous shadows are hovering (maybe they always are). And this is why diversification is always important via long-term investment. Equities, bonds, gold and a small proportion for speculative purposes – this for those who want to try and increase their wealth while maintaining a status quo regarding preservation of wealth.

However, from a speculative standpoint, the Forex market is starting to show signs of alarming behavior, some may even call it a lack of correlation caused by storms forming. Yes, we know the USD/JPY is within its own environment as the BoJ and U.S Treasury/Fed play tag team trying to scare folks away from buying the currency pair. However, putting the JPY to the side for the moment, USD centric weaker positions are showing ability to sustain trends. 

The USD/SGD is a prime example of this momentum. The Fed’s Jackson Hole Symposium begins on the 27th of August and ends on the 29th  and all the major central banks will be attendance. Financial institutions will be keen to hear discussions about U.S bond yields, U.S and Japan currency interventions, but importantly will also want to monitor what Kevin Warsh and his cast of FOMC officers have to say about U.S interest rates. And it has to be known given the past two months from the new Fed Chair, he may remain rather quiet regarding outlook. 

And that might be good for the Forex market and spark some opportunities for traders to find an advantage. Because if nothing new or convincing comes out of the Jackson Hole meetings that financial institutions can decipher regarding their mid-term outlooks, perhaps the near-term will produce more volatility.  The next Federal Reserve FOMC meeting decision will be on the 16th of September. Do not expect interest rates to be raised.

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10Y Treasury Yields 20260728

Thoughts on Kevin Warsh, the Fed and USD, Energy, Nasdaq 100, USD/JPY and Bitcoin

by with No Comment Behavioral SentimentCentral BanksCommoditiesEconomyEquitiesFeatured HighlightsFederal Reserve, Interest RatesForexInvestingRisk ManagementUncategorized

Fed’s Rate Announcement Tomorrow and Underlying Market Conditions as Folks Talk

Tomorrow’s FOMC rate decision from the Federal Reserve continues to cause some angst in the investment community as folks try to decipher Fed Chairman Kevin Warsh’s disdain for tea leaf reading. What is being missed by seemingly a lot of the crowd is the open signal from Warsh that he prefers to keep his outlooks rather muted, this because he appears to be focused on the mid and long-term economic picture.

Simply put, I do not think the Federal Reserve is going to raise interest rates tomorrow, nor will the Fed Chair give too much indication about his thoughts for mid-September. It might be stated in the Fed Press Conference afterwards that the costs of energy is being watched, but that is too obvious. Count on it being recorded that the Federal Reserve will watch data and react accordingly. In the meantime, financial institutions may demonstrate volatile overplayed USD centric positions which look overbought looking into the mid-term, as they still worry about the near-term.

10Y Treasury Yields 20260728

10-Year U.S Treasury Yields Five Year Chart as of 28 July 2026

Political Questions and the Cost of Energy as the Fed Reacts

Let’s for a moment dive into politics. Does anyone think that Kevin Warsh doesn’t speak to Treasury Secretary Scott Bessent who has been a long-time associate? And does anyone think Bessent doesn’t have the constant voice of President Donald Trump in his ear? 

The mid-term elections are nearing ladies and gentlemen. The de-escalation in the Iranian situation certainly has something to do with nations expressing wishes for less military action to the White House. Israel, the UAE, Kuwait, Bahrain, Iraq, Qatar, Saudi Arabia, Pakistan and Turkey are trying to influence positions as President Trump considers his next moves regarding alliances and resources. However, the situation may have something to do with the price of WTI Crude Oil too and its effect on U.S manufacturing and surprise, surprise the Federal Reserve. 

Does anyone else remember that the last de-escalation also started just before the Federal Reserve’s last FOMC meeting in June? I am not being a conspiracy fanatic, just pointing out that lower WTI Crude Oil prices do help the case for a Fed outlook which looks at the costs of energy in a pro-active manner, one which might include the U.S economy and internal White House discussions with politicians who represent voters who have the power of creating a backlash. Lower interest rates equate into lower borrowing costs for consumers.

The Fed’s Impact on Equities and Forex (and the USD/JPY)

So if the Fed does not raise tomorrow, nor gives an indication of what it will do in September and offers a stance of ‘we are vigilant and will watch the economy’ will that help sentiment on the Nasdaq 100 which is starting to have the look of a patient with a bad cold who can’t quite seem to get rid of a cough? Microsoft and Meta step into the limelight tomorrow with earnings reports, Amazon and Apple follow on Thursday.  The combination of the Fed and important quarterly earnings will impact Nasdaq sentiment and other equity indices.

It appears analysts of financial institutions are starting to discuss CAPEX – capital and expenditures – openly. And this is creating shadows as investors weigh the costs of energy and infrastructure against stated profit projections. However, let’s not throw the baby out with the bath water, the Nasdaq 100 has a gain of 20%+ over the past year (July to July), and since March the index has still gained 12%+. The war in Iran (excuse me, conflict) has not had a meaningful impact it appears on the outcome of the Nasdaq 100 via sentiment generated. But the shadow of expenditures, debt and revenue is getting louder bandwidth and speculators need to remain cautious in the indices.

Back to the Fed and Forex, the USD has been strong, you are allowed to say extremely strong if you have been betting on downside incorrectly. The USD/JPY is almost in nosebleed terrain, currently 163.830. The Bank of Japan will announce their interest rate policy very early Friday (for those of us not in Asia) and let’s see if the ‘independent’ Bank of Japan is taking a cue from their government which is clearly interested in continuing to build stronger export ratios. Has the Bank of Japan given up the so-called stated fight to keep the JPY within a solid stance? This is doubtful externally, and Japan is certainly not going to allow the USD/JPY to traverse wildly higher, but it may not consider the 165.000 mark as the end of the world. Beware of saber-rattling from the BoJ in the coming days.

Bitcoin 20260728

Bitcoin Five Year Chart as of 28 July 2026

Doubts and Remarks Regarding Bitcoin Below $64K

On a last note, the world of cryptocurrency remains interesting and stormy. It appears from watching the awkward statements from influencers and crypto (including Bitcoin) media outlets the past couple of months, as they attempt to explain their pain and convince others that everyone should buy at these lower values that more troubles are coming. 

What are the influencers, crypto media’s and importantly financial institutions’ actual skin in the game relative to those who have lost interest in Bitcoin and the digital market worth? Are influencers and large institutions like BlackRock hoping to pawn off their suffering ‘asset’ holdings to the public, while trying to convince us that today’s cheap prices represent buying opportunities? Is the wave of slanted influence and panic-like banner waving a hope to save themselves in order to cash out of a sinking market, this while hoping someone else takes their place in lifeboats that face a difficult voyage to safe harbors? 

BTC/USD is near $63,4000 now. Yes, we know, we have been told plenty of times before that all the Bitcoin winters eventually turn into summer again. Blossoms will create the sweet scent of profit we are assured, but what if the winter becomes an ice age? What if Michael Saylor and his ability to produce complex financial statements and instruments for MicroStrategy and Strategy equity shares continue to make little mathematical sense? What if all the investors into Bitcoin and cryptocurrencies are left holding the bag and find themselves covered by permafrost? The tundra currently looks harsh. Will the Bitcoin crowd who has been so adamant about being free of regulatory controls and mismanaged central banks cry openly for bailouts from the U.S Treasury with USD? Now that would be entertaining.

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