David Rosenberg on whether he would bet against long-term Treasuries

Summary

David Rosenberg discusses Treasury Secretary Bessent's deficit comments and bond buyback operation. He agrees the deficit may have peaked but argues fiscal policy and $40 trillion of debt are not why long-term Treasury yields rose. Instead, he points to war risk premium, Fed uncertainty, and heavy long-dated issuance from AI hyperscalers. He says investors should avoid duration, but also would not fight the Treasury because Bessent could deploy a larger buyback bazooka.

• Bessent argues 2025 saw fiscal consolidation and likely peak deficit.
• Rosenberg agrees the deficit may have peaked due to prior fiscal goodies and tariff revenues.
• He rejects the idea that $40 trillion debt or fiscal policy drove the recent long-term yield rise.
• He points to war risk premium and new Fed chair uncertainty as bond risks.
• He highlights AI hyperscaler long-dated issuance as the big supply driver.
• He says investors do not want to own duration under that uncertainty.
• He says the Treasury buyback is testing waters and could expand with a large bazooka.