Treasuries are losing their haven status. Capital is leaving the US at an increasing rate as the dollar’s reserve-currency standing is diminished, and the risk of a recession raises the likelihood of an inflation-stoking double-digit fiscal deficit.
The market turmoil is intensifying. Stocks and the dollar have been falling, but Treasuries have so far resisted the rout, with 10-year yields dipping under 3.90%. After any nearer-term convexity-driven buying, however, they are sitting ducks:
