Bessent's running battle with the bond market resembles his boss's war in Ukraine — started by his own hand, underestimated opponent, implausible victory. Latest skirmish: unscheduled announcement doubling buyback pace of long-term bonds. Unscheduled move surprises bond investors who value predictability in the $32tn market.

Context: three weeks ago Bessent intervened in yen market, buying currency to prop it up, seen as effort to stop Japan from selling its huge stash of US debt. Now three times in three weeks Bessent signals investors to stop selling bonds, yet they sell anyway, pushing borrowing costs higher as national debt crosses $40tn. Dollar also falls.

Bessent reacts with more bond support, claims growth will magic debt away, tells market it's wrong. Investors await fiscal tightening. August illiquidity amplifies stresses; Big Tech debt issuance pulls funds from government bonds. September bond rush could be messy.

Simultaneous weakness in bonds and currency reflects declining confidence. Stocks insulated by bumper earnings at US companies. But Treasuries and dollar, traditional safe assets, are falling while gold and Swiss franc rise. Fissures in core US assets widening.