🚨 THE US GOVERNMENT IS RUNNING QE WITHOUT CALLING IT QE
The US deficit is projected at $1.9 trillion this year, or 5.8% of GDP.
More than half of it is now being funded with short-term Treasury bills instead of long-term bonds.
By July 2026, the Treasury had issued $413 billion in net new bills, already 15% more than in all of 2025.
Why this matters.
Long-term bonds carry more risk. The 30-year is at 5.23%, its highest since 2007, so investors demand a lot to hold them.
Bills mature quickly, carry far less interest rate risk, and can be used as collateral.
By funding with bills instead of bonds, the Treasury reduces the amount of long-term debt the market has to absorb.
That frees up money for other assets.
The effect looks similar to QE, without the Fed doing anything.
Bloomberg strategist Simon White found four previous periods with this same setup.
S&P 500 returns during them were almost double the historical average.
The sample is small, and rising inflation or war risk could cancel the effect entirely.
But Washington has changed how it borrows, and the change favours stocks.$HEI $BLESS $SYN
#GlobalStocksHitRecordHigh
The US deficit is projected at $1.9 trillion this year, or 5.8% of GDP.
More than half of it is now being funded with short-term Treasury bills instead of long-term bonds.
By July 2026, the Treasury had issued $413 billion in net new bills, already 15% more than in all of 2025.
Why this matters.
Long-term bonds carry more risk. The 30-year is at 5.23%, its highest since 2007, so investors demand a lot to hold them.
Bills mature quickly, carry far less interest rate risk, and can be used as collateral.
By funding with bills instead of bonds, the Treasury reduces the amount of long-term debt the market has to absorb.
That frees up money for other assets.
The effect looks similar to QE, without the Fed doing anything.
Bloomberg strategist Simon White found four previous periods with this same setup.
S&P 500 returns during them were almost double the historical average.
The sample is small, and rising inflation or war risk could cancel the effect entirely.
But Washington has changed how it borrows, and the change favours stocks.$HEI $BLESS $SYN
#GlobalStocksHitRecordHigh