The entire Treasury curve is above 5% and new home sales are up because nothing says confidence like buying at 7% · Daily Briefing

In 30 seconds: US Treasury yields have climbed sharply with the entire 5- to 30-year curve trading above 5%, sparking debate about fiscal sustainability, Fed policy, potential yield curve control, and the impact on equities and mortgage markets. Analysts, led by Luke Gromen, argue the US faces an unavoidable dollar devaluation and shift away from USD as the global reserve asset, with gold returning to a central role as the US debt burden reaches 250-year highs. Proposed US diesel export restrictions have alarmed the EU and energy markets, with US diesel inventories already at 40-year seasonal lows, raising fears that a ban could paradoxically push domestic gasoline prices higher. Presidents Trump and Xi held a high-profile summit with an exceptional tarmac welcome, producing a short-term trade truce and new AI dialogue frameworks, though analysts expect the more consequential negotiations to come at APEC and on Chinese soil.

The entire US Treasury curve from 5- to 30-year maturities is now trading above 5%. The 30-Year Treasury Yield closed at 5.46%, up 6 bp on the day. In the final minutes of trading, the 10-year yield spiked 5 basis points to touch 5.20%. The economy is not cooperating with anyone hoping for a slowdown. The US Composite PMI hit 58.4 in September, a five-year high. The Kansas City Fed Manufacturing Index printed 14 against an estimate of 9, with new orders at 24, shipments at 21, and prices paid at 68. Initial jobless claims fell to 197,000, down from 198,000 the prior week. Firms' year-ahead inflation expectations ticked up from 2.2% to 2.4%, with core inflation already well above the Fed's target. The housing market is feeling it. The 30-year fixed mortgage rate rose 8 bp on the week to 7.03%, and ARM activity has increased, signaling that borrowers are taking on more risk. Meanwhile the fiscal math remains punishing: 7 trillion in bills rolling at market rates, 1.8 trillion in new issuance, and 3 trillion in maturing debt, all against US debt/GDP at 100-year highs. 10-year yield: 5.20%. The equity-bond correlation is, as one strategist put it, the regime-changing risk that makes all the other stuff matter.

Gold closed at $4,305.80 on 2026-09-24, dipping 0.29% on the day. Silver settled at $64.10, off 0.44%. These are not the numbers that matter to the thesis. The numbers that matter are these: US interest payments plus entitlements plus veterans' spending already exceed 100% of federal receipts. The US net international investment position sits at negative 80% of GDP. The argument, advanced persistently in some corners of macro analysis, is that Bessent's 'Hamiltonian economics' necessarily points toward a neutral reserve asset, which means gold, and which means dollar devaluation against that asset. Gold served as the reserve asset from 1944 to 1971. China has already moved to net settling in gold. The precedent people cite is the dollar's 90% collapse against oil from 2001-08, which catalyzed the US shale revolution and permanently collapsed US net oil imports. Those are the choices left after 25 years of galactic stupidity in which we pissed away the biggest geopolitical lead in the history of the world. One acknowledged falsifier: a productivity boom that does not increase unemployment at all. If there is a productivity boom that does not increase unemployment at all, we are going to be wrong.

Trump's proposed diesel export ban has introduced a new variable into an already strained energy market. The logic, presumably, is straightforward: US diesel stocks are low, so keep the diesel at home. The problem is that energy markets do not respond well to straightforward logic. US diesel inventories stood at 107 million barrels as of September 18, the lowest for that time of year in records dating back to 1982. To put that in context, inventories at the same point last year were 123 million barrels. The stockpile has remained low but broadly stable since the start of August. You are stable at a level that hasn't been this bad in four decades. Congratulations. Brussels has raised concerns about Trump's proposed diesel export ban, with the EU in ongoing high-level contact with the US administration and set to assess the diesel situation at a meeting on Sept. 29. EU to assess diesel situation at meeting. The Utilities ETF $XLU is down 17% since the Iran War began at the end of February.

The same Trump driving US Diesel Export Ban and Energy Market Stress is also a factor in Trump-Xi Summit and US-China Relations.

The last time a US president extended that kind of tarmac greeting to a foreign leader was JFK for UK Prime Minister Harold Macmillan in 1962. So: rare company. The optics were warm. One economist cautioned not to expect much from the summit's substance. If you are looking for durable outcomes, one economist says the real action will be in November at the APEC meeting and on China's soil. China's foreign exchange trading center has for the first time connected overseas brokerage firms to its offshore yuan trading platform, broadening participation as authorities work to deepen offshore yuan liquidity. 2027 may be a more consequential year than people think. Do not expect much. This is just a transition summit — only a two-month truce bought by both leaders. The action will be in November at the APEC meeting and on China's soil.