In prepared remarks for this year’s Treausury Market Conference (it’s an annual event co-hosted by the Fed and CFTC), Scott Bessent took a victory lap of sorts.

“In spite of the negative rhetoric and doomsaying of market pundits, especially this spring,” US Treasurys have had their best year since 2020, Bessent boasted, on November 12.

By “doomsaying,” he meant concerns that Donald Trump’s trade policies and, more broadly, the administration’s express willingness to run roughshod over decades of decorum vis-à-vis the formal and informal arrangements which underpin the USD-centric global financial order, might manifest in a buyer’s strike for US debt.

I trafficked in my share of such doomsaying, but as any regular reader will attest, I was everywhere and always keen to remind market participants that as i) the collateral which makes the go ’round, ii) the only viable conduit for recycled USD export proceeds and iii) the preferred vehicle for hard-currency savings more generally, US bonds, notes and bills are indispensable in a very literal sense of the word.

When viewed through that lens, the world needs US paper far more than the US needs to borrow dollars, even forgetting the fact that neither America nor any other monetary sovereign needs to source (“borrow”) its own currency abroad. (I won’t go down that rabbit hole here.)

The concern was (and still is) that between Trump’s quixotic efforts to zero out America’s trade deficit, demonstrated penchant for threatening the unthinkable (up to and including the weaponization of US capital markets) and the ongoing erosion of the rule of law in the US, Treasurys might become “just another G7 claim,” so to speak, albeit one which, by virtue of legacy infrastructure, remains paramount in the global financial architecture.

To be clear, it wasn’t just “pundits,” as Bessent put it, who expressed such concerns. “Pundits” weren’t responsible for the dramatic underperformance which followed the “reciprocal” tariff announcement. That underperformance is illustrated by the “Liberation Day” annotation in the figure below, which plots the cumulative performance of developed market sovereign debt versus US Treasurys for 2025.

Not to beat a dead horse, but “pundits” don’t trade bonds, and while the media can certainly do a lot to stoke fear (which can in turn influence investors), the bond market’s not famous for being gullible and stupid. That’s stocks.

So, the near 8ppt of underperformance US Treasurys exhibited and sustained versus other developed market sovereign debt from “Liberation Day” through early-July wasn’t the fault of any “doomsaying” media conspiracy. Rather, it was the fault of the Trump administration for not managing the message around what, at least initially, looked like a wholesale overhaul of global trade.

And that’s to say nothing of the so-called “Mar-a-Lago Accord” which, like Project 2025, Trump didn’t do enough to distance himself from if he was really interested in allaying associated fears.

Bessent knows all of that, of course. It was Bessent, after all, who convinced Trump to announce his famous “pause” on the reciprocal tariffs following a bond market revolt which, by April 9, had pushed up long-end US yields by 40bps in just four sessions.

In a Baghdad Bob moment, Bessent blamed that spike on “some very large leveraged players.” While there was some truth to that (anytime you get a multi-standard deviation move in bond yields, you’re going to have some hedge fund unwinds), it was obvious to everyone that the root cause of the problem was the tariffs.

All of that came atop preexisting concerns about fiscal profligacy, yes, but more pressing, about the worsening political rift inside the Beltway which, chasmic as it now is, all but forecloses any chance of bipartisan political action to address the deficit and other budgetary matters markets (and ratings agencies) insist are an existential threat.

I recount all of that not to throw cold water on Bessent’s celebratory message, but rather to underscore just how lucky he really was for the balance of the year. Just as remarkable as the staggering underperformance of Treasurys from April to early-July is the recovery from July through November, also annotated on the first chart, above.

In his address to the Treasury conference, Bessent credited himself and the man he works for. “[M]y job is to be the nation’s top bond salesman and Treasury yields are a strong barometer for measuring success in this endeavor,” he said. “By this metric, we are making substantial progress in keeping rates down following the spending blowout from the Biden years. In fact, the US Treasury market has been the best-performing developed bond market this year.”

I don’t think I’m being a partisan to suggest the best year for US bonds since 2020 comes despite Bessent and Trump not because of them. The only thing Bessent gets credit for his having the presence of mind to kick the can as far down the road as possible on upsized coupon sales.

As I put it on November 17, Treasurys’ strong performance in 2025 hasn’t a thing to do with any structural improvement in America’s fiscal trajectory — if anything, fiscal concerns have worsened. Bonds have benefited from the perception that the US economy’s slowing, the resumption of rate cuts, the imminent end to QT and Bessent’s decision to put off coupon auction size increases.

In the same speech, Bessent took the opportunity to deride other advanced economies. “Other developed bond markets have had nowhere near the same success” as Treasurys, he told the audience.

“Some countries have seen demand for their debt reduced or even dry up, especially at the long-end and they have had to react by curtailing sales,” he went on. “But not the United States. We continue to see robust demand at auctions from a wide range of investors, including foreign investors whose holdings of Treasury securities are at record levels.”

That’s great. And I’m not being sarcastic. But I’d gently suggest that instead of counting his wins, Bessent should be counting his blessings. Because revisionist history aside, this train was very close to coming off the tracks a mere seven months ago.