The bond market has stopped waiting for the Fed

Thirty-year Treasury yields hit 5.25% this month, the highest since 2007, and Pepperstone strategist Dilin Wu argues that level has nothing to do with what Kevin Warsh says at the podium. It reflects the IMF's estimate that US gross financing needs have jumped from 26% of GDP in 2010 to around 45% now, heading toward 60% by the early 2030s. Cut rates and you risk confirming inflation is entrenched. Hold, and debt service costs, already running near the Pentagon's budget, keep compounding against a Treasury that has to refinance maturing debt at today's rates regardless. Barclays reckons the one tool that could cap yields decisively, outright long-bond purchases, is politically off the table, which is why Warsh's dovish press conference in July was met with yields going up, not down, as Axios noted.