Scott Bessent’s attempts to suppress interest rates could spark a recession

Live updates

1. 1d ago

   Bond Market Rejects Scott Bessent's $6 Billion Buyback Plan

   Treasury Secretary Scott Bessent's attempt to lower interest rates through a $6 billion buyback of longer-term debt has failed to stabilize markets. Bond yields have hit their highest levels since 2023, while stocks tumbled and mortgage rates remained unaffected. Despite tripling the government's bond-buying program, investors have continued to sell off bonds. Bessent has responded to critics by dismissing the concerns of financial analysts, while some observers warn that these efforts to suppress rates could trigger a recession.

   Why it matters

   The Treasury uses buybacks to manage debt and influence borrowing costs. This operation sought to curb rising yields that increase the cost of government and consumer loans. The failure of the measure indicates a lack of investor confidence in current Treasury policy.

   What is confirmed

   • Treasury Secretary Scott Bessent launched a plan to buy back up to $6 billion in longer-term debt.
   • Bond yields reached their highest level since 2023 following the buyback attempt.
   • The bond market rebuffed the Treasury's $6 billion plan to reduce borrowing costs.
   • Scott Bessent tripled the government's bond-buying program.
   • Bond yields jumped and stocks tumbled after the move to tamp down rates.

   Still unconfirmed

   • A conflict between Bessent and the financial press threatens to spiral into a crisis.

   What to watch next

   • Further Treasury adjustments to the bond-buying program volume
   • Official responses to the rise in bond yields since 2023
   • Data on whether mortgage rates respond to subsequent Treasury actions
   Sources used for this update (11)

   1. The New York Times — Bond Market Rebuffs Treasury’s $6 Billion Plan to Reduce Borrowing Costs
   2. NBC News — Bessent’s move to tamp down rising rates backfires, as bond yields jump and stocks tumble
   3. Fox Business — Treasury to buy back up to $6B in longer-term debt as bond yields hit highest level since 2023
   4. Reuters — Edgy bond investors unconsoled by Bessent's big buyback
   5. WSJ — Bonds Sell Off Despite Buyback Operation
   6. Fortune — 'If the Bloomberg Terminal bros are unhappy with what I'm doing, that's too bad': Bessent's sharp rebuke for policy critics
   7. New York Post — Scott Bessent’s attempts to suppress interest rates could spark a recession
   8. Yahoo Finance — Why Treasury’s $6 billion bond buyback didn’t lower mortgage rates
   9. Yahoo Finance — Treasury Secretary Scott Bessent Is Tripling the Government's Bond-Buying Program, but the Bond Market Doesn't Care (and With Good Reason)
   10. Seeking Alpha — Treasury buyback test exposes limits of support for long-term debt: SocGen
   11. www.rawstory.com — Scott Bessent's furious war with financial press threatens to spiral into crisis: insiders
   confidence 90%