Was asked by fellow bunker my thoughts on the FI market and he told me to post them, others might be interested.
so here:
The Feds Williams doesn’t understand why the 10 year is falling as the Fed threatens to tighten over the next several quarters. It’s simple, yield curve/markets 101.
The Fed is lifting the short rates to create the impression of tightening, but the economy can’t stand on its own 2 feet without the liquidity the Fed has been provided ($150 billion/month). The deficit will be $3 - $3.5 trillion this year -just the status quo, so long rates fall as the Fed is forced to fund the deficit because nobody else wants to buy US long-term debt at these kind of rates. 
Every time QE has ended and there’s even a hint of rates rising, the market falls and you get the Greenspan/Yellen/Powell put jumping into action.
The 2 to 10 spread is already half since early in the year w/the 2Y going to .2 from .61,  also showing that 1 to 1.5 rate hikes have already been priced in.
A couple more hikes and the 2/10 will invert. If it stays that way for 80 or 90 days and it’s highly likely to, we’ll will be in a recession. The only question is how long can the Fed tolerate declining markets…. Is it’s desire to kill inflation stronger than that of propping the markets up or will it tolerate higher levels of inflation to keep the markets propped up. Will know soon. 
so here:
The Feds Williams doesn’t understand why the 10 year is falling as the Fed threatens to tighten over the next several quarters. It’s simple, yield curve/markets 101.
The Fed is lifting the short rates to create the impression of tightening, but the economy can’t stand on its own 2 feet without the liquidity the Fed has been provided ($150 billion/month). The deficit will be $3 - $3.5 trillion this year -just the status quo, so long rates fall as the Fed is forced to fund the deficit because nobody else wants to buy US long-term debt at these kind of rates. 
Every time QE has ended and there’s even a hint of rates rising, the market falls and you get the Greenspan/Yellen/Powell put jumping into action.
The 2 to 10 spread is already half since early in the year w/the 2Y going to .2 from .61,  also showing that 1 to 1.5 rate hikes have already been priced in.
A couple more hikes and the 2/10 will invert. If it stays that way for 80 or 90 days and it’s highly likely to, we’ll will be in a recession. The only question is how long can the Fed tolerate declining markets…. Is it’s desire to kill inflation stronger than that of propping the markets up or will it tolerate higher levels of inflation to keep the markets propped up. Will know soon. 
