AAAU - High Bond Volatility And Inflation Show It's The Fed Itself That's Transitory

• Wild gyrations in long-term Treasury yields are being noticed by mainstream financial news media. “Bond volatility is extraordinary whereas equity volatility is not. Something’s wrong here,” says CNBC analyst.
• The reason for these gyrations is simple. The Fed, dragging mutual fund demand in its bond-buying wake, is snapping up 80% of new Treasury issuance since the Covid era began.
• This causes volatility and means when the Fed starts tapering because of high price inflation, demand for Treasuries could collapse until real yields are *gasp* actually positive.
• This implies that any tapering of QE is impossible as it would destroy the bond market. Inflation is not transitory. It’s the Fed’s monetary system that is transitory.
• When investors finally figure this out, gold and silver will skyrocket in both nominal and real terms. We will enter a new world.

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