The Flows Backdrop For The Great Bond Debate

On Tuesday morning, I walked through the "debate" between Bill Dudley and Morgan Stanley's US rates team over the future of US Treasurys. It was a somewhat begrudging exercise. Begrudging because it felt like a story that was only a story because newsflow was thin around the US holiday. That said, the points Dudley brought up -- that the neutral rate may be higher, that inflation probably isn't going to recede quickly back to 2% and that the term premium should probably be higher too -- are im