美债收益率创24年新高，欧洲主权债务危机风险上升

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Bloomberg Opinions John Authors came into the studio Monday morning just as the 10-year bond yield hit 5.3%.

So, it's now at a 24-year high. So, it's gone higher than it ever did in the spike that precipitated the financial crisis. Wow. Are we at a crisis moment when it comes to bond yields

in the US? No. In the case of France, you have a very imminent signs of a potential crisis in Japan and also in the UK.

I'm Sarah Holder and this is the Big Take from Bloomberg News. Today on the show, I sit down with John and Heather Long, the chief economist at the Navy Federal Credit Union to talk about where bond yields are rising, how central banks around the world could respond, and how consumers in the US are feeling the pressure. So, we've been talking a lot on the show about the sharp rise in bond yields in the US. In the past week, yields on 30-year bonds have hit 5.66%.

There's that new record for the 10-year. It's at its highest yield since 2002. Heather, what does this all tell you about where we are at in the US right now? To me the most interesting question right now is this debate around are these yields rising in the US at least due to a stronger economy. You know we have gotten a lot of interesting data in the last month that points to a healthier consumer than maybe many expected healthier job market than maybe many expected.

So I think that debate we have had some fresh data on and is is one of the most interesting right now. That's a more positive story. So and obviously the White House has fully embraced that story, but you hear a lot of smart voices making that case versus, you know, I lean more on the side. What this is really telling us is a belief in the market that taming inflation is going to be a much harder task. It's going to take longer than we thought.

And that's both in the short-term context of what Fed chair Kevin Worsh can do and in the longer term context of the demographics and the fiscal situation of the US and many other countries. So I lean more on that more negative spin, but I think it's a really interesting debate.

And when it comes to these global markets, again, we're seeing France, UK, Japan seeing high yields as well. How much of that is it caused by the US or set off by what's going on in the US bond market and how much of it is related to sort of domestic factors in these countries?

Um both naturally the way to look at this is like a spark to light a flame. So you don't create a crisis from nothing if a country has its house completely in order. But similarly, if the markets are complacent and allow you to uh carry on, you can have the conditions for a crisis for quite a long time without being called on it. Japan, you know, has been an exception to every rule for a very long time, but if you have rates at 10ear yields were zero for many years because the Bank of Japan literally wouldn't let them rise beyond that.

They're now at three%. That's very serious. I think in Japan there is the possibility you could just try to close their deficit by selling a lot of public assets. Again, much like Margaret Thatcher did back home in Britain, there might be some relatively easy way out of that problem. But if you look at what is happening to the yields on French bonds compared to particularly neighboring German bonds, bearing in mind these two countries have the same currency, the same central bank, and they're supposed to be in a kind of a union that will merge their economies ever more.

The market is plainly saying that it now sees French bonds as being far riskier.

Right? The gap between French bonds and German bonds is the widest it's been since the sovereign debt crisis back in 2011.

Very nearly close to there. Very nearly close to taking that out.

Why is that so significant?

If you have that wide a gap between two countries are in the Euro zone, that means you don't really believe that the Euro zone can hold it together. You're saying as an investor placing your money that way that you think there is a real risk that the Euro zone itself will fall apart. Mhm.

If you have that big a gap between the borrowing costs in the two big European economies, you then get into a spiral effect. France at the moment wants to borrow more than ever before next year, which is an election year which they start with a deficit of 5%. The cost of that borrowing is increasing all the time because of this this run. And that looks very much as though it could spark the final crisis.

Yeah. I mean, to me, this is where the politics is starting to change. The political outlook is starting to change and the market is reacting to this in certain countries around the world. John's just been talking about France. I think you can make the same argument in the United States. You know, what's changed even in the last few weeks. Obviously, we're still in a never- ending war in Iran, and we're gonna run a worse fiscal deficit this year than we even expected, despite this strong economy supposedly have.

Preliminary estimates put it at 2 trillion for 2026.

That's right. You know, and and back in 2019, a more comparable economic year, we were running a $1 trillion deficit. So, you know, you can see uh just how egregious it looks. And on top of that, populism is sweeping. It's starting to sweep the United States. you know, already some early sides of it, but seeing uh the Michigan Senate candidate Abdul El Say, you know, surge to victory there among other types of elections of populist candidates is a wake-up call to the bond market that there is just no fiscal restraint.

This is totally off the table and any signs, you know, for a while it was we're going to use the tariff revenue in the United States to help pay down the debt. And even though that was peanuts, at least somebody was talking about paying down the deficit. Now we have a President Trump who's out saying, "I'm going to send everybody a $5,000 check if Republicans win." And oh, how about a $90 check for people on Medicare?

And so that's where I think I differ a little bit from John. I do think the politics has started to clash with that ongoing reality of the fiscal situation.

And Heather, you're tracking a lot of economic indicators here in the US. Jobs, inflation, consumer confidence. We've gotten a lot of data drops in the past week or so that have given us a fuller picture. When you look at this data in aggregate, how high do you think US bond yields might climb?

Yeah, that's the trillion dollar question right there. It's hard to predict. I'll tell you what, the way I look at it, I get worried if we get past 5.5. It's not that we've never seen it before. It's not, you know, that it can't it could totally crash at 5.55

on the 10 year.

On the 10-year. Yeah, I'm specifically speaking on the 10-year. But as John was saying earlier, this is a rapid repricing. There is a lot of both corporate debt that needs to be renegotiated and redone in the coming years. And to do it at such a higher rate than expected is going to trigger some bankruptcies and trigger some disruption. At the same time, you know, obviously at Navy Federal Credit Union, we are monitoring every day the consumer side, you know, mortgage rate, it's above seven, let alone 7.5% the 30-year mortgage.

It's like being in Antarctica. You know, it's totally frozen. The phone stops ringing. Uh you can see the national data going down. And I worry too that a lot of people personal loans have been going up this year and that has been the lifesaver for a lot of the bottom third of America. and that is no longer accept very accessible to people at these types of rates. So there's just so much strain on the economy. Same thing in the banking sector.

You know, there's a reason the banking sector had a pretty bad September in the stock market. It's because banks are sitting on a ton o