Treasury doubles long-bond buybacks as Druckenmiller warns against rate management
Scott Bessent calls the purchases routine liquidity support; Stanley Druckenmiller says they amount to political price management.
Treasury will at least double its buybacks of 10- to 30-year bonds. The maximum will rise from $2 billion to at least $4 billion per operation from Sept. 9 through Nov. 4. Buying older bonds can make them easier to trade. It also reduces supply, which can lift prices and lower yields.
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Druckenmiller says Treasury is treating the symptom
Stanley Druckenmiller is a billionaire investor who worked alongside Bessent at Soros Fund Management. He called the expansion “price management” and a “mistake.” His case is that holding down yields could hurt the market’s trust in Treasury and delay the harder work of cutting the primary deficit. Treasury says the program helps trading and does not target interest rates.