Long-dated Treasury yields need to stay high because megacap tech companies now compete for bond buyers. Oracle bonds yield over 8%, Meta's over 7%, and Google sold a 10x-oversubscribed 100-year sterling bond above 6%, while hyperscaler issuance is surging from $35B toward $200B. Megacaps are becoming as creditworthy as governments, making this a new paradigm of persistent competition, and Warsh appears to agree hyperscaler debt plays a role. x.com  x.com  x.com  x.com  x.com  x.com  x.com  x.com 

AI data-center investment needs outside AI spending to rise 33-fold by 2030 to break even. Hyperscalers hold $4.5 trillion in debt and future liabilities, but corporate and SaaS token spending outside circular deals is only $60 billion annualized against a $2 trillion break-even ARR. SK hynix says memory shortages may last until 2031, raising capex and CoreWeave default risk; Mitsubishi warns turbines are booked through 2031 and cost 400% more, delaying CoreWeave and Oracle data centers. x.com  … Show more

Potential spending cuts and AI-related deflation make long-dated US Treasuries an asymmetric opportunity. A Democratic sweep could cut spending; an AI-trade blowup could cause deflation, while the AI trade hurts employment. Ending the Iran war could reduce spending and oil prices. Further crude gains could damage the economy hard and quickly enough to outweigh the inflation threat. x.com  x.com 

AI borrowing is pushing rates up because hyperscalers will pay any price for money, so rates must keep rising until they hurt price-sensitive borrowers. Amazon, Alphabet, Meta and Oracle sold about $194 billion of bonds by early July, 79% more than in all of 2025, and the 10-year yield touched 5.33%, the highest since 2002. Julien Garran warns a downturn may not lower long yields much, with big deficits everywhere while Japan and China step back from Treasuries. x.com 

Long-dated Treasuries are under pressure from AI's debt explosion and rising inflation volatility, as shown in a chart by Bloomberg's Simon White. The basis trade is in a shaky state and oil is back near $100, among many other factors, and it is unclear how much longer private equity and private credit can hold their breath. x.com 

Long-dated Treasuries could benefit from less issuance of AI-related debt, which today's news may point to, even if the deal itself is minor. Separately, a free Meta Muse hurts the leading AI models at least at the fringe, and wide consumer adoption of AI agents will come when Apple launches its own or partners with a model maker. x.com 

Expensive borrowing makes debt-funded AI projects harder to justify, pressuring AI stocks and the S&P 500. Inflation keeps pressure on rates. If Republicans lose Congress after the midterms, Trump could rely on executive action to speed permits, power projects and existing funding programs, keeping AI investment moving despite expensive money. Tech and risk assets could catch a bid if earnings hold and bond yields settle; Fed cuts remain uncertain. x.com 

Treasuries are losing their risk-free appeal as inflation runs hot and US government credibility erodes. If the 10-year projects inflation to surge, bonds that barely beat it make little sense, and Fed hikes won't slow a hot economy or fix an energy supply shock with oil at $100. Higher borrowing costs make the growing debt harder to finance, leading to money printing and more inflation. Big tech is more creditworthy than ever; even for fixed income, Alphabet's corporate debt is preferable. … Show more

Treasuries offer diversification from AI risk because a tech decline would drag credit-sensitive bonds down with it. Stick to Treasuries rather than credit for that hedge. x.com 

Long-dated US Treasuries look unattractive when AI credit pays twice as much and the market assumes the Fed will bail it out if it breaks. Borrowers who don't care what money costs are setting the price for everyone else, so homebuyers pay through higher mortgage rates and small businesses through layoffs. JPMorgan is marketing a $5B Volta AI loan at roughly 11%, per a news post. The Fed has repeatedly protected big banks and is unlikely to let capitalism play out when banks face pain. x.com  … Show more