I don’t want to say Scott Bessent’s lost the US long-end, because that’s a little too histrionic, but for a guy who variously insisted the market would see in Donald Trump’s policies the type of judicious stewardship that warrants lower long-term borrowing costs, it’s fair to assess things aren’t going as planned.

30-year Treasury yields were ~5.15% early Thursday in the US, suggesting dip-buyers weren’t enticed by the prior session’s overtly bearish price action. Although the dollar looked poised to stabilize, it was still down meaningfully on the week, a decidedly inauspicious development in light of sharply higher yields.

Liz Truss was trending, and as I put it in the brief editorial accompanying Wednesday evening’s Daily, that’s never a good thing. The zeitgeist is “sell America.”

The figure above suggests the market’s displeased with Donald Trump’s tax cut extensions which Mike Johnson finally managed to ram through the House. The bill still needs to make it through the saner of America’s two legislative chambers, and unlike Trump, it won’t come away from its Senate trial unscathed.

But one way or another, Republicans are likely to pass the sprawling measure, and as ING’s Francesco Pesole wrote Thursday, referring to Trump’s characterization of the legislation, “Trump’s tax bill is anything but ‘beautiful’ for the dollar.” “The post-‘Liberation Day’ episode underscored how quickly the dollar can fall amid renewed confidence issues surrounding US assets, and downside risks for the greenback remain elevated,” he wrote.

I mentioned this several times already this week, but to the extent Trump’s worried about bond yields, he’ll have to twist in the wind. Bessent could, if he wanted, claim the market’s illiquid and step in with more buybacks. But that’d be seen as desperation, and as BMO’s US rates team remarked on Thursday morning, Treasury would have to fund stepped-up buybacks with more borrowing (i.e., T-bill issuance) and it’s “unlikely to be executed at a sufficient size to satisfy the market.” Long story short, Scott could engineer a modest bull flattener, but it’d surely prove fleeting.

The only other option is Jerome Powell, who doesn’t need to borrow to buy bonds, and could, if he wanted, buy them in size. But he won’t, because that’s QE and lest we should forget, the Fed’s still engaged in QT. Plus, the Fed’s not worried about this right now. There’s scant evidence the economy can’t perform with long-end yields at or a little above 5%, so unless market functioning’s severely impaired, Powell won’t bat an eye. He’d rather thumb his nose, and who can blame him? (“Who’s the ‘loser’ now, Mr. President?”)

As I write these lines, it looks as though Thursday might at least be calmer for Treasurys. That doesn’t necessarily mean the long-end will be bid, just that it won’t be hate-sold. At this point, Bessent will take any relief he can get.