The U.S. bond market remains high and unyielding! Bassett takes action to expand the repurchase plan, emphasizing not quantitative easing.

U.S. Treasury Secretary Basent said on Tuesday that the Treasury Department decided last month to expand the old maturity U.S. Treasury bond buyback program primarily to "cool down" the recently overheating bond market and push the market back toward a balanced state. He also denied that this operation constitutes quantitative easing (QE) and refuted the claim that the recent decline in Treasury bonds is mainly due to investor concerns about the scale of U.S. debt. Speaking at an event in Washington on Tuesday, Basent stated that his responsibility is to work towards bringing the market back to a balanced state, but he does not believe that the Treasury can change the equilibrium price of the assets themselves. My job is to try to push the market back to a balanced state, Basent said. I dont think I can change the equilibrium price, but the market is never in equilibrium all the time. Basent made these remarks as the U.S. Treasury is set to conduct its first longer-term old bond buyback operation following the expansion of the program on Wednesday. Last month, the Treasury announced it would increase its buyback efforts after the yield on 30-year U.S. Treasury bonds temporarily rose to the highest level since 2007, putting significant selling pressure on the long-term Treasury bond market. Regarding the market environment at that time, Basent described the bond market as forming a "feverish" state. Basent, who has long served as an executive at a hedge fund, expressed that based on his past experience in the financial markets, when market participants engage in speculation, they often hope to accelerate the progression of the market. One of the aims of the Treasury's expanded buyback program is to help restore balance in such situations. The so-called U.S. Treasury buyback refers to the U.S. Treasury purchasing already issued government bonds in the secondary market. This plan mainly targets older maturity securities that are relatively illiquid, aiming to improve market functioning and liquidity rather than directly changing the overall scale of government debt. At the same time, Basent denied that the recent sell-off of U.S. Treasury securities is primarily due to investor concerns about the governments continually increasing borrowing scale. He believes that if the market were genuinely to start worrying about the U.S. credit situation, investors should theoretically sell U.S. Treasury bonds and shift to German bonds, but the actual market performance has been quite the opposite. If everyone is worried about U.S. credit, then you should sell U.S. Treasury bonds and buy German bonds, but thats not whats happening, Basent stated, adding that the relative performance of U.S. Treasury bonds has actually been better. Furthermore, Basent clearly denied that the expansion of the Treasury's U.S. bond buyback plan is equivalent to another form of QE. Quantitative easing is typically implemented by the Federal Reserve through large-scale purchases of U.S. Treasury bonds and other securities to inject liquidity into the financial system and lower long-term financing costs, which has been used multiple times during past economic and financial crises. Im not doing QE, Basent said. Compared to QE, Basent has previously shown a preference for comparing his policy approach to the Federal Reserve's historical "twist operation."