저자: Kevin · 외국인
요약 보기
10년물 국채금리가 5% 돌파, 2년물도 상승한 상황에서 Fed가 Wednesday 회의에서 금리인상을 하지 않으면 장기금리 상승(텀프리미엄)과 스프레드 확대, 인플레 기대 악화, 스태그플레이션 우려로 주식시장이 타격받을 것이라는 주장. 관세 인하, 이란 전쟁 종식이 인플레 완화책이라 언급. Klarna의 현금·예수금 구조를 들어 BNPL 취약성과 신용스프레드 확대 위험 경고.
다듬은 글
It's official: the 10- year Treasury yield just broke through the 5% mark— the first time we've crossed that level in 3 years. I think we're in for a lot of "firsts" this week in the last 3 years, including not only this high-profile IPO prospectus from Anthropic, but also the first rate hike in 3 years.
So, apparently a lot of things are happening for the first time in 3 years. But we need to answer the question: What if the Federal Reserve says, “Hey, yields have already gone up. I don't need to fight inflation. Just look at the yield on 2- year Treasury bonds. She has already grown up. It is at level 4.
almost 68%, while at the beginning of the year we had 3.5%. 2-year bonds rose by 1.2 percentage points. What should the Fed do? Why do anything at all? We could just sit back, relax, and leave Fed rates at the same level. And in this video, we'll break down why it might not work as well as it seems.
So , the reason for this idea comes from the latest Fed press conference, the next one of which will be in 2 days, to test whether Kevin Warsh actually has the guts to raise rates, or whether he is really a henchman appointed by Donald Trump. This will be a test of courage. Does he have eggs? Did he put on pants?
Or is there nothing to cover up? This will be this week's test. But in any case, at his last press conference he said: “Hey, the market seems to be functioning normally. People are more concerned about inflation risks, and suddenly yields are rising. So the market does it itself. Why should I do anything?
"This is essentially what he hinted at in the last meeting. And this is normal for intermediate signals: does it need to give predictive guidance or not? Maybe not, if the bond market gives you the signal . And I think that's exactly what he's saying. It's not like the bond market will do all the work for him .
He still has to adjust the discount rate. Rather, the market will take on its signaling function. Why should this be so? The easiest way to think about it is—what happens if the Federal Reserve doesn't raise rates on Wednesday? There are 11 different things that I have highlighted...There are quite a few different options for what could happen.
Well, we do n't have to number them all, but I'll go through some of the most important ones . Let's start with what happens with the 10-2 spread? So, first of all, if the Federal Reserve doesn't raise rates on Wednesday, this relatively stable spread that we've had, you know, below the 0.5 range, hovering somewhere in the 0.2-0.4 range, could become unstable.
So, if we look at this from the beginning of the year, we see that we are actually at a pretty low level. We had some concerns at the beginning of the war. But we did get rid of some of those concerns. When did we have these fears? Why did this graph go up? When the graph rises above 0.5, it means our risk of shock is increasing.
So, the risk that some "black swan" will collapse the economy increases as this graph goes up. At the end of the year, we were worried that the labor market was starting to lose ground. The data showed that the labor market was rapidly approaching zero. This was not good. So it's no surprise that the 10-2 yield spread has widened.
It's simply the difference between the two-year and ten-year returns. And if we look at it historically, we want it to be stable. We don't want any sudden jumps on this line . Because if you look, sharp jumps on this line occur at the beginning of a recession. 1990—a sharp leap. And 2000–2002 was also a sharp jump.
The market really “shot” or peaked in the early 2000s. We got the latest rate hike from Alan Greenspan. His rate hikes began in 1998 and peaked around May 2000 . And its latest rate hike is associated with reaching a market peak, the top of the "bubble," so to speak . So you get this giant surge starting in the first quarter of 2000.
You get this giant surge starting here in 2007, just before the Great Recession. Of course, there was also the Covid period, which was short-term and not as widespread as the others. Considering all the money printing to save from the Covid recession that happened. Oh, that dirty one-month recession.
But either way, you want it to be stable. So, if you want the economy to hold up , so that it doesn't falter or collapse, you want this indicator to be stable. If the Federal Reserve doesn't raise rates on Wednesday, the market will conclude, "Okay, you don't care about inflation anymore." You have no authority when it comes to inflation.
Therefore, we will demand a higher term premium or demand a higher yield on long-term bonds. So, in principle, 10-year bonds should rise even more. The two-year bonds you see here are rising on expectations that the Fed will raise rates; but it is entirely possible, since two-year bonds are closely tied to Fed policy, that if the Fed does not raise rates on Wednesday, their yields will fall.
Because now the market is saying, "Okay, they're not really going to raise rates." Okay, fine. " Short-term rates are probably going to be lower, but they've just lost all authority over inflation." And so long-term rates are going up. That means the 10-year is going up and the two-year is going down.
What does that do? It widens the spread between those two . These little arrows are the spread. When you widen the spread, you make this graph go up really fast , like it did in other recessions. You don't want to do that. And there are more reasons for that. We'll get to them . But that spread is going to widen very, very quickly if they don't raise rates on Wednesday.
If the spread goes above 0.5 points, we're in shock-prone territory. And when we cross the 1 mark, especially if it happens quickly. So if the spread goes above 1.0, that's usually a red flag that a recession is coming. Why is that happening? Okay, there are a few reasons. reasons. When long-term rates go up, the cost of borrowing skyrockets.
That's exactly what Scotty B is trying to control , and he's failing. He's trying to lower credit card rates. He's trying to lower mortgage rates. He's trying to keep the economy going, but long-term yields keep going up. The way to lower those long-term yields is to solve the inflation problem. There are a number of ways that you can solve the inflation problem quickly.
And I think Donald Trump would be very smart to implement some of them. But the three main ways that we can solve inflation right now is to eliminate tariffs. You would get an instant drop in inflation, probably 2 or 3 percent. Hell, we could go into the red instantly if we just went back to free trade.
And yeah, I know this is where, you know, Donald Trump supporters usually say, "But Kevin, it wasn't fair before." Okay, Let it be. We had trade- weighted tariffs of 2.2% to other countries. Other countries had an average of 2.4% to us. So yeah, the terms were a little bit against us . But we're talking about 2% to 2.4%.
Now we have tariffs on other countries averaging about 12% . See, that's what causes inflation. So if you want inflation to go away quickly, Donnie T., why don't you stop shooting yourself in the foot? Then rates could really go down. Dude. But that's not going to happen because that would be too smart.
You could end the war with Iran. I think that could really happen. I think—and this is just my guess—that they're going to form some kind of coalition in the Middle East that takes control of that regime and allows Donald Trump to get out of the game nicely, like the Saudis, Oman, Bahrain, and Kuwait say, "Hey, we're We'll figure it out, Trump." Don't come on, we'll figure it out.
Just please, go away . "And then Donald Trump can declare victory," it's all out in the open again. We won. "Withdraws troops. That would be great for reducing inflation, but maybe it's just a pipe dream. So these things could reduce inflation. Alternatively, you need to raise rates to build confidence and keep inflation expectations from getting out of hand, because if they get out of hand, you'll get stagflation.
Okay, so what else happens if you don't raise rates on Wednesday? First, confidence. Second, the term premium. So long-term yields go up. And that hurts what Scott Bessant and Trump want, right? You get potentially unmanageable inflation expectations, and that leads to stagflation fears . As soon as there are stagflation fears, the stock market starts to lose value.
That worst-case scenario. Our entire economy, I think, is hanging on a toothpick from the stock market. If the stock market ... you know, sometimes people write to me in the comments, "Oh, Kevin, you just want the stock market to go up so you can make money." And I say, "Listen, guys, we'd be a lot better off if rates went down to zero, even if something really bad happened, because that would be great for real estate ." I don't want that to happen.
It's going to happen. The stock market going up is just a small part of the picture. At least from our perspective. I say it's hanging on by a thread, because if something were to crash the stock market, anything: stagflation fears, stupid Fed decisions, lack of confidence, anything that would blow the market.
If the stock market goes down, you know, people are going to say, "Ha, that's what these big guys need." The whole world economy is just going to go down the drain. It's going to be terrible. You don't want a stock market crash. As soon as the market crashes, all that cyclical spending that keeps this whole system alive and running stops .
And the mass layoffs are going to be just massive in the worst sense of the word. And then along comes this whiny Kevin Warsh at the Federal Reserve, who's not going to print money to save your asses. So they're going to cut rates to zero, which will help the rich, but they're not going to save anyone else .
And it's going to be very hard to get Kevin Warsh to expand the balance sheet, especially with a divided Congress. Good luck getting any stimulus or $5,000 checks passed, right? Good luck . So it's really, really bad. So the fact that the Fed doesn't raise rates could actually kill the stock rally. Okay, but that's not all.
So, confidence, to sum it up, right? Just to get you back on track. Confidence takes a hit if they don't raise rates. rates. The term premium on long-term bonds is rising. That's hurting AI funding, consumers, and other areas. Fears of stagflation are driving down U.S. stock valuations. Got it? That's not all.
The more those yields go up , the more banks' capital ratios suffer , because the bonds they hold look like they've lost even more money. Essentially, bondholders lose even more money, and the banks are like, "Dude, we're getting killed here." When banks start getting hurt, they can't make as much credit.
Okay, I do n't usually do that , but today in the live stream for the course participants, we looked at a company—just to give you an example of what "killing" means , okay? We looked at a company called Klarna. You've probably heard of it, okay? It's a buy-now, pay- later company. They have about $2.6 billion in cash.
I just want to show you that they're in trouble, okay? It's a Swedish company, they have a Swedish banking license. They're applying for a banking license in the United States. Let me show you how they're going to be in trouble if the Fed doesn't raise rates, okay? They have $2.6 billion in cash. But $ 3.1 billion in accounts payable.
They don't have enough cash to pay their bills right now. But let me tell you something else. They have $11.6 billion in deposits, like bank deposits. If all these people wanted to take their money out right now, if everyone who's holding that $11.6 billion demanded it right now, Klarna doesn't even have that much money.
They already have a negative balance, comparing the amount of accounts payable to the amount of cash on hand . So they're literally already in the red, without even a hint of a bank run. So they're already in the red, in dire straits. This is a company with a market capitalization of $8 billion that has $11.6 billion in deposits on hand.
The average time these deposits typically remain in the bank before being withdrawn is about 9 months. So a significant amount of deposits can be withdrawn very quickly. This is an example of how a " black swan" starts to destroy banking institutions. You get BNPL companies that collapse because the stock market is falling and credit spreads are widening.
This whole pyramid is tottering and collapsing, it's really bad, and we can see it right in front of us. I'm showing you Klarna's financial statements for June 30, 2026. I'm showing you that they're clearly in the red . And right now, it's like everything's fine. But that doesn't mean it's always going to be that way.
Okay, the next thing is spread widening . So what is spread widening? Spread widening is when the 10- year Treasury bond yields 5%, like right now. So let's take the orange marker, okay? If the 10-year bond is yielding 5%, why would I buy Google bonds at 6%? I'm going to go to Google and say, " Google, I need 7% or 8%, or whatever, to compensate for the risk, because right now I can get a 5% risk-free rate on the U.S.
Treasury." So that carries the risk of widening credit spreads, which is also a kind of early warning sign of a recession. People are starting to worry that corporations won't be able to sustain the yields that they have to pay to service their debt. We already know that free cash flow has plummeted, and it's expected to be negative for all of the Magnificent 7, at least for the big hyperscalers like Meta, Microsoft, Google, Oracle, and others.
Um, that's not very good. But. And on top of that, which we seem to have discussed. You have a spike in spending that is also being passed on to consumers. So, if you put all of these together, ironically, things are going to get worse if the Fed doesn't raise rates. So I think when Voor says, "Oh, the market has already adjusted," I think that's a way of saying that the market has already given you a guidance.
But his credibility will be lost if he doesn't raise rates. That's bad. Long-term yields will be worse. That's bad for the AI rally. That's bad for the consumer. Inflation expectations are going to get much worse because people are going to see him as a clown, a figurehead, and a political puppet.
And that person's career is basically going to be ruined. The amount of criticism he's going to get if he does n't raise rates is going to be insane. He has to do it. If he doesn't—it's going to be insane. But he has to . Then we have the risk of stocks repricing because of a lack of confidence and inflation risk.
In my opinion, if he doesn't raise rates on Wednesday, it's actually bad for the stock market. But I think he does, the markets will recover, and all this AI drama that we had over the weekend will not be a problem at all, and it will be seen as an opportunity to buy on the dip. But we still have peak fear, you know, after last week's CPI, and the Fed meeting on Wednesday.
We'll have to see if he goes into the defibrillator or not. There's also the risk of bank losses, widening spreads, and, as we mentioned, a spike in consumer spending. So not raising rates would just be silly. I hope that's clear enough. .
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