Trump Unleashes His Latest Weapon Against the Bond Market: The Military

War is the continuation of politics by other means. When asked about a possible new intervention by Scott Bessent to bend rates that refuse to come down, Donald Trump did not seek nuance. His response is surprising even in trading rooms accustomed to his outbursts. For weeks, the Treasury has been buying back bonds to calm the market, but with little lasting effect. Key points from this article: * Donald Trump mentioned a military intervention to influence the bond market, creating shockwaves in the financial world. * Despite the Treasury's and Scott Bessent's efforts to calm rates, the bond market has resisted, highlighting the ineffectiveness of bond buybacks in a context of rising debt. The phrase deserves to be quoted in full. Indeed, when asked if he had discussed with Bessent an "alternative form of intervention," President Trump replied: "The ultimate intervention is our military. And if we have to use it, we will." No one, not even at the White House, has explained how tanks could lower a thirty-year yield. The statement comes as long-term rates rise again towards multi-year highs, against the backdrop of a very real war against Iran. Trump is no stranger to attacking an institution that is supposed to remain beyond his reach. He has already: * multiplied attacks against the Fed, * called for more significant rate cuts, * pushed for a more compliant leadership renewal. The bond market, unlike the central bank, has no president or board to convene. It is thousands of anonymous buyers—pension funds, foreign central banks, asset managers—who set the price each day. No martial declaration changes much. This is not the first time an American president has directly attacked market mechanics. In 1971, Richard Nixon unilaterally closed the gold-dollar convertibility window to stem another crisis of confidence. The context is not comparable, but the interventionist instinct has crossed decades without losing much of its edge. However, the Treasury did not wait for this outburst to act. Scott Bessent doubled his long bond buyback program (10 to 30 years) on August 19, raising the ceiling from $2 billion to at least $4 billion per operation, until November 4. Alas. The 30-year yield, which had temporarily dropped from 5.34% to around 5.19-5.24%, has since risen again. The Treasury buys, the market absorbs, and lenders continue to demand their share. A mechanism that grinds more than it convinces. However, buying a few billion dollars in bonds per operation remains trivial compared to a market that trades hundreds of billions each week. Creditors, meanwhile, look elsewhere: a debt growing faster than the economy that supports it, inflation remaining above target, and now a president talking about tanks rather than fiscal discipline. It is difficult to sell confidence under these conditions. In this context, it is hard not to see the martial statement as an admission of powerlessness rather than a credible threat. The U.S. federal debt now exceeds $40 trillion, and its interest burden has surpassed that of the defense budget, the very one Trump just invoked. The irony is not lost: the military he threatens to mobilize already costs the state less than the interest on its own debt. The bond market, for its part, yields neither to buybacks nor threats. It simply continues to do what it has been doing for months, demanding a higher price to lend to an increasingly indebted borrower.

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