The 10-Year, the Margin Call, and the Great Reordering

The 10-year is stubborn—and is now above where it was when the panicked walk-back of tariffs happened last month (feels like a year ago). But here’s what it means, realistically. And as someone who was trying to be optimistic, it isn’t great news.

The hope—the dream—was to slow demand, cool the economy, and glide gently into a world where rates settle under 4%, inflation behaves, and we return to “normal.” A soft landing, low rates, full employment, and financial stability. That fantasy is dying. It may be dead. But the problems aren’t even hiding anymore.

The Treasury Market Isn’t Signaling Strength. It’s Signaling Stress.

The talking heads and those with TDS want to make this about confidence in America. “Rates are spiking because the U.S. is broken.” Wrong frame.

Yields are rising because the global financial system is under strain, and Treasuries—the safest, most liquid asset on Earth—are being sold not by choice, but by necessity. Pension funds. Insurance companies. Hedge funds. Banks. Sovereigns. They’re all long bonds somewhere, and when rates rise, prices fall—and suddenly those positions are underwater. Think the failure of SVB, but worse.

The problem with bonds right now is that for banks, it’s not just a red number on a screen. It’s a hole in your capital ratios. It’s a breach of your leverage covenants. It’s a margin call.

This is not a bet against America. This is a systemic margin call.

Emerging Markets Are Bleeding Out

Emerging market central banks are dumping Treasuries to defend currencies, shore up dollar reserves, and keep their debt from spiraling. But every sale drives yields higher… and higher yields force more selling. It’s a doom loop in real time. This isn’t market “behavior.” This is stress showing up in the only market large and liquid enough to absorb it—and it’s not absorbing it well.

The System Was Built for 0% Rates. It Can’t Survive 5%

This is the deeper truth no one wants to say out loud: The global economy was built on free money. For a decade-plus, zero rates weren’t an emergency measure—they were the foundation. Governments levered up. Companies levered up. Households levered up. Now that debt has a cost again—and the system can’t handle it. So what happens next?

I Fear We Get Rate Cuts—But Not Because We’re Winning

The Fed will eventually have to cut. That’s almost inevitable now. But not because they beat inflation. While Trump shouldn’t say it… I will… Powell is an idiot. The Fed is a joke. And now, “Too late” will cut because something breaks. And when it does, they’ll have to provide liquidity. They’ll have to restart asset purchases. They’ll have to “restore order” in the Treasury market. Which is just a polite way of saying: we’re going to monetize the dysfunction. Again.

And That’s When the Real Shift Begins

This isn’t just about rates. It’s about what kind of world we’re moving into.

• Rates down.

• Inflation up.

• Assets soar.

• Trust collapses.

It’s not a boom. It’s not optimism. It’s a wall of money slamming into a fixed supply of assets. Stocks, real estate, gold, bitcoin—they go vertical, but not because they’re better. And with that shift comes a brutal reshuffling of who wins and who loses.

Winners and Losers in the Great Reordering

Winners:

• The asset rich. If you already own real estate, equities, hard assets—you win. You’re ahead of the flood.

• The indebted, especially with long-term fixed-rate debt. You borrowed dollars that are now being devalued.

• The U.S. government, bizarrely. Inflation erodes their liabilities.

• Gold, Bitcoin, and anything scarce. Anti-fiat assets become trust havens.

Losers:

• The middle class. Wages lag. Costs soar. Savings melt.

• Retirees and conservative savers. Inflation + low rates = quietly getting wrecked.

• Small businesses and laborers. Squeezed by rising costs and weak consumer demand.

• Emerging markets, who borrowed in dollars and now can’t roll or repay without pain.

This Is Not a Cycle. It’s a Transition.

We’re not in the late innings of the old game. We’re in the early innings of a new one. One where:

• Central banks can’t win without massive collateral damage.

• Fiscal authorities won’t stop spending because they politically can’t.

• The next bull market will be denominated in broken money and driven by inequality on steroids.

We’ve gone from “higher for longer” to “higher broke the machine.” I fear the pivot is coming. It’s coming with a forced liquidation, a sad monetary reset, and a new understanding: the system can’t be fixed. It can only be patched. Too big to fail, but for real. And when the patch job fails, the reckoning gets real.

Not sure what to do with it, but … it’s a vibe.