Name: Why The 30-Year Treasury Lost Its Biggest Buyers | David Busch
Uploaded: 2026-09-19T16:34:45+00:00
Duration: 4064 s

Speakers

David Busch — Co-CIO, Traent Wealth

Summary

David Busch of Trajan Wealth joins Jack Farley to discuss why long-dated Treasury yields remain elevated despite high debt supply and inflation. Busch argues higher-for-longer rates favor 3-5 year Treasuries as ballast while long-end demand has weakened as insurers shift to private credit. He also sees software stocks, especially Intuit, as oversold on AI disruption fears, and highlights energy, nuclear, and rare earth minerals as bottlenecks for the AI buildout. Busch warns on private credit liquidity/credit risks and notes rate sensitivity in levered sectors.

U.S. Treasury supply, inflation, tariffs, energy shocks, and AI-related corporate issuance are driving elevated yields.
Busch favors 3-5 year Treasuries as portfolio ballast and avoids extending out 20-30 years.
Long-dated Treasuries have lost natural buyers as insurers and pensions shift toward private credit and IG corporates.
Private credit carries elevated credit and liquidity risk, with opaque loan tapes and redemption gates.
Software stocks and Intuit are seen as oversold on AI disruption fears; incumbents may adopt AI to improve margins.
AI infrastructure buildout bottlenecks include energy, nuclear power, and rare earth minerals.
Rate-sensitive levered sectors such as financials, insurers, banks, and REITs may face elevated volatility.
Treasury buybacks are viewed as a liquidity signal, but too small to change the market.

Ideas

David Busch Co-CIO, Traent Wealth 13:16

Long-dated Treasuries lack natural buyers.

Busch argues the natural buyers of 30-year Treasuries—insurers, public pension plans, and sovereign wealth funds—have shifted toward private credit and IG corporates, while Treasury supply is huge. Higher yields have not brought them back, and he would not extend out past 20-30 years because duration and convexity risk are high and a catalyst may be needed to force a return to Treasuries.

David Busch Co-CIO, Traent Wealth 18:18

Avoid private credit due opaque risks.

Busch is skeptical of private credit despite equity-like yields: it carries embedded credit and liquidity risk, often opaque loan tapes, redemption gates, and is now being marketed to retail after institutional demand. Trajan Wealth has largely avoided private credit and only uses select credit strategies with loan-level transparency.

David Busch Co-CIO, Traent Wealth 27:48

Favor 3-5 year Treasuries as ballast.

With yields high and the curve positively sloping, Busch favors 3-5 year Treasuries as portfolio ballast. They provide diversification and safe-haven protection, and an investor can buy a higher-coupon 5-year and let it roll down toward 3 years if the curve stays stable. He explicitly avoids extending out 20-30 years.

David Busch Co-CIO, Traent Wealth 43:13

Levered sectors face rate volatility.

Busch warns that the current higher-rate environment is most dangerous for levered balance sheets, including financial companies, insurers, banks, and real estate/REITs. These sectors may see elevated volatility as borrowing costs remain high.

David Busch Co-CIO, Traent Wealth 43:39

Software stocks oversold on AI fears.

Busch thinks software stocks are likely oversold because the market has priced in severe AI disruption. He expects incumbents to adopt AI, improve margins and efficiency, and argues most customers will still want expert software for complex tasks. If AI disruption is less severe than feared, the sector has room to rebound.

David Busch Co-CIO, Traent Wealth 43:55

Intuit AI selloff overdone.

Busch singles out Intuit: its tax-planning software sold off as an AI loser, but most Americans will not build their own tax, estate, or financial planning software with Claude/ChatGPT. Human expertise, compliance, and liability support demand, and Intuit can use AI to improve margins, so the selloff looks overdone.

David Busch Co-CIO, Traent Wealth 50:50

Data incumbents protected by workflows.

Busch argues AI is unlikely to displace entrenched financial data and terminal providers like S&P Global, FactSet, and Tradeweb. Their value comes from data collection, costly data licenses, instant messaging/communication, and deep workflow integration; building an in-house substitute would miss key functionality.

David Busch Co-CIO, Traent Wealth 56:20

AI buildout benefits multiple sectors.

Busch says the AI infrastructure buildout requires an all-hands-on-deck supply response across materials, industrials, utilities, and energy suppliers. The biggest constraint is energy needed to power and cool data centers, with local pushback already appearing.

David Busch Co-CIO, Traent Wealth 57:22

Own diversified energy source portfolio.

For data-center power demand, Busch believes no single energy source is sufficient; he favors a portfolio including coal, natural gas, oil, wind, and solar. He is not dismissive of green energy because the scale of demand will require traditional and renewable sources alike.

David Busch Co-CIO, Traent Wealth 57:48

Watch small nuclear reactors.

Busch calls U.S. nuclear power underdeveloped and is following companies developing small nuclear reactors that could power data centers. He sees it as an important potential solution to the AI buildout's energy bottleneck.

David Busch Co-CIO, Traent Wealth 58:10

Rare earths are AI bottleneck.

Busch sees rare earth minerals as a key AI buildout bottleneck: China controls 70-80% of supply while the U.S. needs alternatives. He is following new mines, recycling, and refining of existing equipment as potential solutions.

Why The 30-Year Treasury Lost Its Biggest Buyers | David Busch

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