Treasury-Led Financial Repression Is Ushering In A Debasement Regime | Weekly Roundup

**Felix** (0:00)
Nothing said on Forward Guidance is a recommendation to buy or sell any investments or products.
All right, what's going on, everybody? Welcome back to another roundup edition of Forward Guidance. And the first one without our man, without our Ponzi man, he would be laughing. If he could get away from compliance right now, you just know the type of shit he'd be saying to you. We're recording on Wednesday. We just had the best announcement. We're going to talk a lot about it. But man, like I miss that guy. He would, Tyler would be all over this right now.

**Quinn** (0:37)
The Ponzi, the Ponzi just got kicked into high gear. I mean, we saw glimpses of it for every week, basically for the last since the start of August. And this is just the next leg. Because in practice, we'll talk about it. But you know, this is this is a small announcement compared to probably the stuff they're going to be doing, but it sends a big signal.

**Felix** (1:00)
Yeah, yeah, 100%. Okay, yeah, first off, obviously, it's just us two for now this week. But we're definitely looking at starting to get a few rotating regulars onto the show to join us once in a while. So if anybody has any suggestions or people they think they'd love to see on here for the next little bit, while we start to get some, you know, we'll still do the duos, and then we'll shop around and have a few folks come in once in a while as we start to decide on who we want to be a third guess. Like, you know, for sure, the roundup is not as best when there's three of us. You know, we can all just banter and bounce off each other's ideas. So definitely going to lean into that. But yeah, I just want to open up that if anybody has any suggestions or ideas on people as we start to vet and plan for the fall, definitely, yeah, leave some comments, let us know.
Okay, other piece of admin, Digital Asset Summits are kicking into high gear this fall. So for those that don't know, Digital Asset Summit is the Digital Asset Institutional Conferences that we put on. We do three every year. There's the bread and butter one in New York that we do every spring. We've been doing one in London for a few years now too. And then for the first time in October, we're going to Asia. We're going to Singapore right around the weekend of October 20, 2049 So the whole industry is going to be there. It's going to be a lot of fun. I haven't been to Singapore before, so I'm excited. It's I've heard a lot of good things.
It's going to be great. We have some great speakers. We have the CEO of Hyperliquid, Jeff speaking, which is sick. I'm definitely the most excited for that. But yeah, we'll be there. We'll be doing some macro panels as well. Quinn's coming. Yeah. Looking forward to it, dude.

**Quinn** (2:43)
It's going to be sick. I booked my flights, ready to go.
It'll be a nice little getaway after coming back into the swing of things in the grind in September.

**Felix** (2:57)
The lock and grind of the fall is there's nothing like it. Like after Labor Day hits, you're just like, let's go. And it's just like, I'm ready to get after it. It's good. Yeah, it feels good. Yeah.

**Quinn** (3:07)
Totally.

**Felix** (3:09)
All right. Get your tickets.
Yeah, prices will be going up pretty regularly. So don't leave it till last second.

**Quinn** (3:17)
All right.

**Felix** (3:18)
Let's talk about the elephant in the room.
This news that just came out this morning of what Secretary Besson is doing. So last episode, obviously, we had a whole, most of the episode is framed around this idea that marginal macro policy is moving to the Treasury more so than the Fed. And Scott Besson and Treasury is making sure that the long end does not get unruly. And nothing really hit. Obviously, we've had these small little sample, a little appetizers, like we had the QRA, where they changed from potential increases in coupon issuance to a change which opens the door for potential lowering of coupon issuance. So already signal there, there's the end intervention stuff. And now we got this today, which is that they're announcing an increased size of nominal long-end treasury buybacks. So this is definitely pretty meaningful. And the language is really aggressive. Like, this is really here. The US. Department of the Treasury is increasing by at least double the size of liquidity support buyback operations for long dated nominal coupon securities, the 10-year to 20-year sector, and the 20 to 30-year sector. The current maximum size of 2 billion per operation will be at least 4 billion dollars per operation. So, okay, what does this actually look like? Is that these are buybacks. So they're not just, you know, the first thing you have to think about is, okay, what's funding the buybacks? And so the first slide, what are they buying? They're buying off the run long end bonds. They're super liquid. Obviously, we've been talking about how the 30 year and the long end has been, you know, at least decade highs and neil. So it's getting pretty unruly. So they're coming in, they're buying the author on bonds, which are the most liquid. And what are they funding it with? They're funding it with treasury bills. And so you net that out. If you're issuing treasury bills in no duration and you're buying duration, you're taking duration out of the market. If that sounds like a different variation of QE, it's because it is.