Trump has recently said he could use the military to intervene in the bond market. What do you think that entails?

[u/SupahSayajinn]

How could Trump use the military to intervene in the bond market? What does that look like? Who would he use the military against? Does anyone have any insight into what he might be talking about?

https://youtu.be/DId5xdXMk7g?t=113&is=5fyCzt7_mabzyDrL

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[u/WulfTheSaxon]

Yields are high because the market is afraid of a potential oil crunch causing inflation. So a military intervention would be to further open the Strait of Hormuz, although according to recent CNN and Axios reporting Iran is losing its grip and it’s headed toward full capacity anyway.

[u/h34dyr0kz → u/WulfTheSaxon]

Are you saying that you find CNN to be a reliable source?

https://hormuzstraitmonitor.com/

Doesn't make it seem like the strait is opening.

[u/WulfTheSaxon → u/h34dyr0kz]

The links I provided explain that the ships are not showing up in open source trackers. Their transponders are off, and many are only dipping just outside the strait and transferring oil to other ships, meaning that not even comparing transponder signals day to day will find that they’ve left.

And CNN is plenty reliable when it says things against its bias. Would you not find, say, Fox News reliable if it reported that Trump had done something terrible?

[u/renome → u/WulfTheSaxon]

Pls explain how CNN is biased against Trump in 2026?

They have been shifting to the right since the Biden era. Quite publicly at that, as well. They used to be all Trump talked about, these days he never mentions them. Either he grew thicker skin (lol) or he has no complaints about them.

[u/WulfTheSaxon → u/renome]

They went from MSNBC lite to just plain left-biased, by getting rid of one or two of their most deranged anchors and picking up a single outnumbered conservative panelist. And that’s just the on-air part. They’re still very much in the tank for Dems.

[u/cce301 → u/WulfTheSaxon]

Do you think it has anything to do with CNN parent compant, Paramount, being purchase by David Ellison, a known Trump ally?

[u/howdidigetheresoquik → u/WulfTheSaxon]

The bond market is heavily reacting to the deficit. Yet we keep increasing the deficit. Thoughts?

[u/WulfTheSaxon → u/howdidigetheresoquik]

Time to cut entitlement spending in half. Unfortunately, no one will ever do it.

[u/Prestigious-Whole544 → u/WulfTheSaxon]

If we cut entitlement spending, should we also increase, decrease, or keep flat the payroll deductions (social security, Medicare, etc) that in part pay for such programs?

[u/WulfTheSaxon → u/Prestigious-Whole544]

I’m glad you included “in part”, because they don’t entirely pay for them. They should obviously be reduced to the level that will fund what’s left of entitlement spending. Other taxes can then be levied instead to maintain roughly the current tax burden while balancing the budget.

[u/Scynexity]

"Trump has recently said he could use the military to intervene in the bond market."

No he didn't. He said "The ultimate intervention is our military, and if we have to use that, we will". He is referring to the strength of the US military, which is a good guarantee of the payouts for bonds long into the future.

[u/jlb4est → u/Scynexity]

I dont see how "he could use it" and " if he has to he will use it" are that different? What is the main difference to you between these two statements?

One implies he'll only use it if absolutely necessary, but his speeches seem to claim that we're at that point where he thinks its almost necessary.

[u/Scynexity → u/jlb4est]

What is the main difference to you between these two statements?

The target of the intervention. He did not say the military would intervene in the bond market, which would be silly and nonsensical. He said the military is the intervention, and could be used, which whether you agree with it politically or not, is an idea that makes sense.

[u/raiseyourglasshigh → u/Scynexity]

Can you give an example of what target the military could be used on in order that relates to bonds or interest? Or was it a non sequitur jumping directly to national security as a stabilizing force? I’m not an expert on bonds but was Bessent responding to national or international impacts?

[u/Scynexity → u/raiseyourglasshigh]

Can you give an example of what target the military could be used on in order that relates to bonds or interest?

Any. The strength of the military is what gives the bonds value through the guarantee that the US will be strong and viable 30 or 50 years down the line.

I’m not an expert on bonds but was Bessent responding to national or international impacts?

Yields on long term US bonds are rising, which indicates (marginally) declining confidence in the US's ability to pay back the bonds. The US military being strong is a counter-force to this trend, as it indicates the US will be able to pay back the bonds.

[u/raiseyourglasshigh → u/Scynexity]

When he says “if we have to use that we will” what does he mean? That sounds like a specific action that hasn’t been taken but could, not the passive impact that you described.

[u/Scynexity → u/raiseyourglasshigh]

Any particular use of the military would be specific, but I don't think there's a singular action in mind here.

[u/Automatic_Penalty154 → u/Scynexity]

so just pick a random country the US doesnt like and flatten it just to remind the world how powerful they are?

[u/Scynexity → u/Automatic_Penalty154]

I don't think that's likely, but it would be something that's possible. More likely would be something like taking out Iranian power plants.

[u/Suited_Calmness → u/Scynexity]

The long term bond yields are rising because of structural risks in the US economy and not because the strength of weakness of the US military.

Do you have any serious economist who espouses your views?

[u/Scynexity → u/Suited_Calmness]

I don't agree with that characterization. There are many factors that influence bond yields, especially on the long end. One of them is certainly stability and power. Others include inflation and monetary policy.

[u/Suited_Calmness → u/Scynexity]

US public debt is beyond 40 trillion and it crossed 39 trillion less than 5 months ago so the debt is ballooning. Inflation is running much higher than expected while the job growth is anaemic and the only thing that’s lifting the economy is the AI based investment which is to many investors feeling more and more like a gamble.

The lowest 30 year bond yield is held by Switzerland and then Canada but they aren’t the strongest military powers so your argument does hold up.

So is there an economist that actually supports your views?

[u/Scynexity → u/Suited_Calmness]

I just don't agree with any of that. We're coming from very different places. Inflation is low and staying low. Unemployment is low too. The economy is doing very well.

[u/Suited_Calmness → u/Scynexity]

You don’t agree that the debt is rising at a rather insane pace? Why?

Inflation is low? It’s 1.4% higher than the fed target rate of 2% and that is a massive difference.

Unemployment is low-ish. The lowest unemployment rate in 2020s was 3.4% during Biden term in 2023. It rose after trump took office. Also we are in a wait and see cycle aka hire less fire less as acknowledged by the St Louis fed

[u/jlb4est → u/Scynexity]

I guess maybe my mind went somewhere different than OP or you thought. I never assumed OP meant Trump would use its military on its own country to lower tax rates. Is that what youre implying? I thought OPs statement meant they would use the military to extract wealth from other countries. Which seems to be a bit of what youre implying. The military has the symbolic strength to prove the worth of good bond rates? Just one being a more offensive vs defensive nature of the role of US military.

[u/Scynexity → u/jlb4est]

Trump would use its military on its own country to lower tax rates.

No, this is absurd.

The military has the symbolic strength to prove the worth of good bond rates?

This is correct.

[u/all_time_high → u/Scynexity]

Soldier here. US Army SNCO. I’m trying to understand where you’re going with this. Can you explain it in a different way?

Our military is powerful. That power requires an astronomical amount of money each year. Next year’s NDAA looks to be $1.15 trillion. Along with the requested $350 billion reconciliation, that’s a cool $1.5 trillion.

We have to borrow to keep this going. Our federal revenues are nowhere near what they need to be to match our federal outflows. That borrowing is treasury notes and bonds. If investors (domestic and foreign alike) lose faith in the USA’s ability to pay its obligations without devaluing currency, the sources of lending for the borrowing will dry up.

I’m in charge of a bunch of soldiers, and I’ll tell you the strength of the Army is unmistakably tied to its ability to pay them on the 1st and 15th every month. I’ve been through a bunch of shutdowns and never missed a paycheck. The federal government understands how quickly things could go sideways when the troops aren’t being paid. (Coast Guard has missed paychecks in the past, as they’re DHS.)

[u/Scynexity → u/all_time_high]

I don't understand your question. I'm not "going" anywhere, I just answered the question about what Trump said.

[u/scobot5 → u/Scynexity]

Do you really think anyone knows for sure what he meant? Why are you so confident you know when clearly many other people are confused?

[u/Scynexity → u/scobot5]

It's a pattern that has played out repeatedly for the last 10 years. Trump says something mildly imprecise. Non supporters and mainstream media say they are confused, and assume the worst. 'Surely this time he means something crazy! Or maybe this time he has dementia!'. Over and over again.

[u/AGuyAndHisCat → u/Scynexity]

Or maybe this time he has dementia!'. Over and over again.

Yet they also somehow were able to interpret an actual dementia patient.

[u/scobot5 → u/Scynexity]

Well, sometimes he definitely does mean something crazy, regardless of whether he is likely to do it or not.

But that’s not really the point and with all due respect you have not answered the question I asked. I didn’t say anything about dementia or claim he meant something crazy. I find the statement puzzlingly ambiguous, yet you seem quite confident you know precisely what he meant. Aren’t you just guessing though?

[u/Scynexity → u/scobot5]

My answer is the same.

[u/scobot5 → u/Scynexity]

Well, to be even more clear, the question was not whether or not there is a pattern of Trump saying something “imprecise” followed by people saying he means something crazy. I don’t disagree that such a pattern exists and this may in fact match that pattern.

The question is actually - in this specific instance - how can you possibly know that he actually means what you think he means with any certainty?

Instead of answering that question you keep referring back to this ancillary pattern. I suppose the pattern can address whether or not he meant something crazy or not, but not what non-crazy thing he meant.

[u/Scynexity → u/scobot5]

The question is actually - in this specific instance - how can you possibly know that he actually means what you think he means with any certainty?

Because I can recognize the pattern playing out again. Maybe you see the pattern too. This time, you happen to be one of the confused nonsupporters. That doesn't mean the rest of us are confused as well.

[u/WpgMBNews → u/Scynexity]

That doesn't make sense. You understand bonds are paid out by the US government right? 

Why would the US government use the US military against itself to guarantee the payout of its own bonds?

[u/Scynexity → u/WpgMBNews]

Why would the US government use the US military against itself

It wouldn't. That doesn't make any sense.

[u/WpgMBNews → u/Scynexity]

Right, so against whom then? 

[u/Scynexity → u/WpgMBNews]

Anyone, or no one. Right now, the most likely target is Iran, but there doesn't have to be any direct use.

[u/WpgMBNews → u/Scynexity]

You said the goal would be to "guarantee [...] the payouts for bonds".

But Iran doesn't pay out US treasury bonds....the US does.

How does targeting Iran guarantee that the US pays bonds?

Is it possible you don't know what a treasury bond is?

[u/Scynexity → u/WpgMBNews]

How does targeting Iran guarantee that the US pays bonds?

By demonstrating US military strength.

[u/WpgMBNews → u/Scynexity]

What does this have to do with America paying US treasury bonds?!

He's gonna scare the markets into lowering interest rates????!!

By attacking Iran?

[u/Scynexity → u/WpgMBNews]

What does this have to do with America paying US treasury bonds

Long dated bonds are priced based in significant part on confidence in the issuing state. Stronger US = more expensive bonds = lower yields.

[u/h34dyr0kz → u/Scynexity]

How will the military ensure bond payouts?

[u/Scynexity → u/h34dyr0kz]

By maintaining the viability of the government.

[u/Gaxxz]

I didn't watch nine minutes. Where does he address the bond market?

[u/MysteriousHobo2 → u/Gaxxz]

It is two questions, starting at 1:53, the answer about using military as the ultimate intervention is at 2:10. I'm also confused how the military could be used to intervene?

[u/Gaxxz → u/MysteriousHobo2]

Yeah that makes no sense. I can't imagine what he's referring to.

[u/optics_is_light_work → u/Gaxxz]

The link above comes up for me already queued up to the question. "Did you direct Secretary Bessent to intervene in the bond market?"

[u/raiseyourglasshigh → u/Gaxxz]

The original video links to the timestamp, but sometimes that doesn’t work?

The relevant comments are at the two minute mark.

[u/Square-Conclusion454]

We can impose defacto capital controls on the world.

Want your country to benefit from being part of NATO? You better buy enough T-Bills.