The Bond Market Always Gets the Final Vote

The bond market is getting restless. What rising yields, $40 trillion in debt, AI spending, and Scott Bessent reveal about the price of money.

Bill Clinton famously exploded during a 1993 economic meeting: “You mean to tell me that the success of the program and my re-election hinges on the Federal Reserve and a bunch of f***ing bond traders?”

More than three decades later, the bond traders are once again getting everyone’s attention.

My guest on this recent WhoWhatWhy podcast, economist Dean Baker, questions some of the conventional explanations for what’s happening — starting with the alarm surrounding America’s $40 trillion debt. “If we have a strong, growing economy,” Baker argues, “our debt’s not a problem.”

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