The 10-year Treasury at 4%–5% is healthy and bullish — not a crisis — because 5% is the level where buyers return, and the real 'bond vigilantes' worry will only matter when the market itself frets about deficit issuance.
Yardeni dismisses bond-vigilante panic: 4%–5% is the historical 'old normal' and a healthy, bullish range, since 5% yields drew in buyers in 2023. He argues he will only worry about government debt when the bond market itself worries about it. ✦ AI generated
Ed Yardeni · The Compound · 2026-08-07 · original ↗
starts at this moment · 3:06
“So, Ed, how about those bond vigilantes?”
I think four to 5% is kind of the range that they should be at... we could have a repeat of 2023. Remember when the bond deal went up from four to five% in 3 months and at 5% there were buyers... I'll worry about all this government debt when the bond digital worry worry about it. And they did worry about it in 2023. We went from four to 5%. But what I learned from that is... it's a market and at some point you're going to have a price and 5% did the trick... I think four to 5% is kind of the the the the old normal. This is where we were before the great financial crisis... four to 5% is healthy. It's a bullish level. It means that the capital markets are actually free to allocate.
verbatim transcript · starts at 3:06
2:52>> stole from him. His wife's husband. >> His wife's hus >> You mean him? >> His wife's brother. >> Yeah. >> His wife's brother. >> Yeah. >> Cleaned them out. >> Yeah. Cleaned them out. >> It's a >> like $18 million or something. >> Yeah. Crazy story. >> Back then it was a real real money. >> Yeah. Um the problem there is when your lawyer is also your business manager
3:11and has power and has power of uh power of attorney. That tends not to go well. >> So Ed, how about those bond vigilantes? >> Well, um they're they're kind of restless. you know, they're pushing bond yields up a bit. I don't think it's a to the point where I'm concerned about it. I think four to 5% is kind of the range that they should be at, but um you know,
3:32we could have a repeat of 2023. Remember when the bond deal went up from four to five% in 3 months uh and at 5% there were buyers. I mean, that's the wonderful thing about markets. >> I'm so glad you said that. I want your take on this. I I think you might agree with me. Um I am technically inclined. I believe in technical analysis. >> I agree. Okay. But I don't believe in it
3:51with interest rates. And here's why. >> When that's an interesting point. >> I'll tell you why. I'd like to hear your take. >> When a stock is consolidating or it's in an uptrend, eventually it breaks out and it continues to go higher, right? At some point >> with interest rates. So if you look at the 10-year, you would say it's an uptrend and you would say it's been
4:08consolidating for a long time and it's probably going to break out of this range. If you're just looking at a chart, you don't know what it is. You would say, "Yeah, buyers in control." But I don't think that with with the stock market when a stock breaks out, people chase it. >> Holy it's going to go higher. I better buy today. It doesn't work with interest rates. Holy I need to
4:25take I need to borrow money today. No, no, no. Stop. Stop. Stop. Let me finish. You don't say I need to borrow. You don't say I need to borrow today because this be more expensive to borrow tomorrow. Number one. Number two, it might even be the opposite because at higher yields, a ton of buyers come in. Holy I I actually >> lock it in. >> I want to lock it in.
4:43>> Yeah. pushing a whole different mentality. >> So, it's the opposite of a stock market breakout. >> A very good point. >> Well, I don't think any technicians chart yields themselves. They chart the price of >> they chart an a bond ETF. >> JC would fight you. He charts interest rates, >> does he? >> Yeah. >> Or he can't chart anything, right? >> What's the difference? >> But I think it's a good point. Thank