Group 1: Treasury Yields Overview - The yield on the 10-year Treasury note was 4.06% as of September 12, 2025, while the 2-year note was at 3.56% and the 30-year note at 4.68% [1] - A long-term view of the 10-year yield shows significant historical context, starting from 1965, including the impact of the 1973 oil embargo [2] Group 2: Inverted Yield Curve and Recession Indicators - An inverted yield curve occurs when longer-term Treasury yields are lower than shorter-term yields, with the 10-2 spread being a reliable leading indicator for recessions [2] - The average lead time to a recession from the first negative spread date is approximately 48 weeks, while using the last positive spread date yields an average lead time of 18.5 weeks [4][6] Group 3: Mortgage Rates and Federal Funds Rate - The Federal Funds Rate influences borrowing costs for banks, which typically affects mortgage rates; however, recent trends show mortgage rates declining despite the Fed holding rates steady [7] - The latest Freddie Mac survey reported the 30-year fixed mortgage rate at 6.35%, the lowest since October 2024 [7] Group 4: Treasury ETFs - ETFs associated with Treasuries include Vanguard 0-3 Month Treasury Bill ETF (VBIL), Vanguard Intermediate-Term Treasury ETF (VGIT), and Vanguard Long-Term Treasury ETF (VGLT) [9]

Mortgage Rate Drivers - Mortgage rates are closely tied to the bond market, particularly the 10-year Treasury yields [1] - Economic conditions and inflation expectations significantly influence bond yields, subsequently affecting mortgage rates; a weak economy can lower rates, while strong economic data can increase them [2] Spread Analysis - The spread, the difference between the 10-year Treasury yield (approximately 420 basis points or 42%) and mortgage rates (approximately 650 basis points or 65%), is influenced by lender profit margins, loan origination costs, and demand for mortgage-backed securities [3] Borrower-Specific Factors - Personal finances, including credit score and down payment size, impact mortgage rates; higher credit scores and larger down payments generally result in lower rates due to reduced lender risk [4] - Advertised mortgage rates are typically available only to borrowers with high credit scores (700s or above) and substantial down payments (at least 20%) [5]

ETHZilla (Nasdaq: ETHZ) announced it will deploy $100 million worth of ETH into EtherFi, a liquid restaking protocol, to boost treasury yields. The company holds 102,246 ETH, valued at around $456 million.https://t.co/Do8tpe2qwh ...

Market Reaction - S&P 500 index experienced a decline in futures trading [1] - Ten-year Treasury yields saw a slight increase [1] - The market views the combination of falling S&P 500 futures and rising Treasury yields as unfavorable [1]

Treasury yields rose from a three-month low ahead of a key inflation report that may shape market expectations that the Federal Reserve will cut interest rates as soon as next month https://t.co/Y3Iq2o7vfp ...

Government Debt Issuance - The Treasury is issuing $58 billion in three-year notes [1] - The government aims to increase liquidity following a $5 trillion debt ceiling increase [1] - A record $100 billion four-week bill auction is expected on Thursday [1][2] - The Treasury issued $50 billion in one-year bills, the second largest ever [2] - A $85 billion six-week bill auction occurred, the largest ever [2] Bond Market Dynamics - The size of auctions keeps growing or staying at historically high levels [3] - The administration is issuing shorter bills due to the optimistic view that interest rates will decrease [4] - Prices paid for the three-year auction were just under 70, almost the highest in three years [4] - Short maturity treasury yields did not reflect the weak ISM data, unlike longer-term yields [5] - The yield curve flattened, contrasting with the steepening observed on Friday [5]

Core Viewpoint - The content emphasizes the importance of conducting personal due diligence and consulting competent advisors before making any financial decisions, particularly in the context of investments and trading [1]. Group 1 - The website provides general news, personal analysis, and third-party content intended for educational and research purposes [1]. - It explicitly states that the information does not constitute any recommendation or advice for investment actions [1]. - Users are advised to perform their own research and consider their financial situation before making decisions [1]. Group 2 - The website includes information about complex financial instruments such as cryptocurrencies and contracts for difference (CFDs), which carry a high risk of losing money [1]. - It encourages users to understand how these instruments work and the associated risks before investing [1].

Federal Reserve Policy & Presidential Influence - The President desires lower interest rates and expects the Federal Reserve (Fed) to align with his objectives, despite potential conflicts with sound monetary policy [1][2] - The President might replace the Fed chair with a more dovish nominee to achieve his desired policy outcomes [2] - A Fed that prioritizes the President's agenda over its independence could negatively impact the dollar's value due to concerns about biased policy and currency debasement [3] Potential Treasury Actions - The President may instruct the Treasury to intervene in the bond market to suppress long-term yields [4] - The Treasury could reduce long-term bond issuance by 25%, which would have a similar impact to the Fed's largest monthly quantitative easing (QE) program [5] - Decreasing bond supply could keep yields low, but might also lead to inflation and accelerated economic growth [7] Market Implications - Actions to control bond yields could lead to rallies in stocks, gold, and Bitcoin, potentially weakening the dollar [6] - Starving the market for duration through reduced bond supply could maintain low yields if demand for Treasury bonds remains strong [7]

Group 1: Economic Environment - The May 2025 Personal Consumption Expenditures (PCE) inflation report indicates core PCE inflation rose approximately 0.22% month over month and 2.68% year over year, reinforcing expectations for the Fed's hawkish stance [1][11] - Treasury yields have increased, with the benchmark 10-year yield climbing from roughly 3.35% to about 3.45%, reflecting market reactions to persistent inflation data [2][11] Group 2: Financial Sector Performance - Financial institutions, including banks and insurance companies, are expected to see increased profitability due to higher lending rates and improved net interest margins in a high-rate environment [4][5] - The S&P 500 Financials Select Sector SPDR (XLF) has risen 9.1% year to date as of June 30, indicating strong performance in the financial sector [5] Group 3: Investment Opportunities - Stocks such as Nelnet, Inc. (NNI), Pagaya Technologies Ltd. (PGY), and United Fire Group, Inc. (UFCS) are highlighted as viable investment options due to their strong earnings momentum and favorable growth rates [3][11] - Nelnet (NNI) has an expected earnings growth rate of 59% for the current year, with a Zacks Rank 1 and a VGM Score of B [8] - Pagaya Technologies (PGY) shows an expected earnings growth rate of 195.2% for the current year, also holding a Zacks Rank 1 and a VGM Score of B [9] - United Fire Group (UFCS) has an expected earnings growth rate of 8% for the next year, with a Zacks Rank 2 and a VGM Score of B [10]

Federal Reserve Policy & Economic Outlook - The Federal Reserve maintains a "wait and see" approach, with expectations of eventual rate cuts, but less aggressively than previously anticipated [2] - The market is data-dependent, with the possibility of the Federal Reserve not cutting rates this year [2] - Tariffs and higher oil prices could lead to underestimation of inflation [3] - A weaker labor market could prompt the Federal Reserve to move more quickly towards lower rates [11] - The market anticipates the Federal Reserve to act on data in September, considering inflation and employment data [13] Bond Market Dynamics - Investors require a higher term premium to hold U S debt [3] - Foreign buyers of Treasury bills are holding the line despite tariff concerns [6] - The 10-year Treasury is relatively attractive, while the 30-year Treasury above 5% would be interesting [18][19] - The treasury may change the dynamics around supply [20] - Single B bonds present opportunities for compression ahead [48] Credit Market & Investment Strategies - Credit spreads have recovered to pre-stress levels, with a preference for double B bonds over triple B bonds for excess carry [32] - Expectation of spread widening over the summer due to slowing growth data and the Federal Reserve remaining on hold [34][35] - Focus on high-quality fixed income due to uncertainty from tariffs, weather, and fiscal policy [36] - Mounting risks are being digested due to high starting yield levels, making fixed income attractive from a risk-adjusted perspective [39] - The market favors shortening duration and the belly of the curve (five to seven year) in investment grade [43][44] Specific Company & Market Events - X AI, Elon Musk's startup, is raising $900 million in debt and equity, offering sweeter pricing on the $5 billion debt part due to burning through $1 billion a month [31] - UnitedHealth and Enbridge had top deals, driving volume to about $18 billion [30] - Key economic data to watch includes the Consumer Price Inflation report and Jay Powell's testimony on Capitol Hill [50][51]