Bond sell-off is a warning to the Fed

Financial Times/Mohamed El-Erian

Repost from 10-1-2021

cartoon of two happy travelers driving over cliff in car

“This has made the move up in yields over the past couple of weeks particularly notable, raising interesting questions for markets, policies and therefore the global economy.”

USAGOLD note: Are we in the early stages of another taper tantrum? El-Erian avoids saying as much but he does warn ultimately that “prolonged central bank yield depression” can inflict “collateral damage and unintended consequences” – like the way investors react as the Fed signals its intention to snatch away the punch bowl.

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