Severe Bear Market in U.S. Treasury Notes and Bonds Persists

By the Curmudgeon

Introduction:

Short post this week due to Rosh Hashanah observance Sept 11-13th. Skin cancer surgery tomorrow (Sept 14th). Wish me luck!

U.S. Bond Bear Market Comments & Charts (Uggh!):

30 Year U.S. Treasury yield is at a multi-decade high at 5.37% as of Sept 11, 2026. Here's a 20-year chart of the 30-year Treasury Bond (constant maturity):

The 10-year T-Note yield, at 4.975% on Friday Sept 11th, was the highest since June 2006! The 10-year U.S. T-Note yield is partly the market’s expectation of average future short-term policy rates. If investors conclude the Fed must keep rates restrictive for longer—or even tighten again because inflation remains sticky—the whole curve can reset higher. More below.

The 10-year yield rose roughly 80 basis points from its late-February low through early September, according to TD Economics. Here's a 20-year chart of the 10-year Treasury Note (constant maturity):

Explanation for Higher Long-Term Rates in 2026:

· Much of the 2026 rise in Treasury yields is an expectation of higher-for-longer Fed policy rather than to a large change in long-run expected short rates.

· Sharply rising oil prices and sticky inflation numbers have also contributed to higher interest rates.

· The sell-off in global bonds (UK, Germany, Japan, etc. is also a factor.

· The five largest hyperscalers will borrow ~$570 billion in 2026 for AI infrastructure capex.

· Finally, total U.S. national debt officially surpassed the $40 trillion milestone, causing bond investors to demand higher yields to absorb the relentless supply of new government debt to be auctioned.

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More Charts & Comments:

The 10-year rolling returns on U.S. 15 Year Treasuries is now -2%, the worst in 100 YEARS, as per BofA Global Research.

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Jim Paulsen notes, “during the last 76 months, the U.S. stock market has outperformed U.S. bonds by an almost 28% average annualized pace – the biggest outperformance of stocks above bonds in 100 years!”

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Luke Gromen says: "Long Term U.S. Treasuries are already down by 85-90% in gold terms since global Central Banks stopped growing U.S. Treasury holdings in 2014."

Graph of ZB (LT UST futures), priced in gold, since 4q2014:

7:54 AM · Sep 5, 2026 post on X.

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Benn Steil reports, “global reserve accumulation has slowed sharply since the early 2000s, when emerging-market central banks were rapidly building their dollar stockpiles. The upshot is that the issuance of Treasuries needed to finance US debt has been outpacing the demand of these once-reliable price-insensitive borrowers.”

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Quote of the Week:

Joe Brusuelas, chief economist at RSM US:

"Global investors are looking at a potent mix of higher inflation, higher interest rates and an unsustainable fiscal path... You put all of those together, you've got a recipe for a global increase in interest rates, which means everything that touches credit in the major economies is about to get much more expensive."

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Wishing you good health, success and good luck. Till next time.............

The Curmudgeon
ajwdct@gmail.com

Follow the Curmudgeon on Twitter @ajwdct247

Curmudgeon is a retired investment professional. He has been involved in financial markets since 1968 (yes, he cut his teeth on the 1968-1974 bear market), became an SEC Registered Investment Advisor in 1995, and received the Chartered Financial Analyst designation from AIMR (now CFA Institute) in 1996. He managed hedged equity and alternative (non-correlated) investment accounts for clients from 1992-2005.

Victor Sperandeo is a historian, economist and financial innovator who has re-invented himself and the companies he's owned (since 1971) to profit in the ever-changing and arcane world of markets, economies, and government policies. Victor started his Wall Street career in 1966 and began trading for a living in 1968. As President and CEO of Alpha Financial Technologies LLC, Sperandeo oversees the firm's research and development platform, which is used to create innovative solutions for different futures markets, risk parameters and other factors.

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