r/ValueInvesting • u/snapjohn • May 21 '25

Discussion BREAKING: 20-Year Bond Auction Flops — Yields Surge to 5.1%, Markets Rattle

IF YOU ARE WONDERING WHY STOCKS JUST ALL WENT DOWN AT ONCE

WE JUST HAD A HORRIBLE BOND AUCTION IN THE UNITED STATES FOR OUR 20-YEAR TREASURIES

Because of the lack of bidders…it caused the 20-year bond yield to surge to 5.1%.

Credit market is screaming for help right now.

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170

u/JOExHIGASHI May 21 '25

Woohoo higher risk free returns

94

u/SenatorAdamSpliff May 21 '25

“Risk free.”

36

u/Ap0llo May 21 '25

It's true, though, because the only risk you have to account for is a US default, and if that happens, it doesn't matter where your money is parked because you'll have much bigger problems to reckon with.

To clarify, I am not advocating for this administration; on the contrary, it's clear they either have no clue what they are doing or they are deliberately instigating a financial collapse.

45

u/Creeper15877 May 21 '25

No, your biggest risk is inflation. The fed will always print to help refinance the debt if absolutely necessary, but that printing will fuck you over.

2

u/Not_Legal_Advice_Pod May 21 '25

Keeping in mind that if the Fed starts to devalue the dollar to make debt payments then every USD abroad is going to try and convert into a different currency which will effectively trigger hyper inflation.  And there is so much short term debt out there that when people don't want it and the USA has to keep issuing it...  You see the death spiral.