https://www.npr.org/2024/11/14/nx-s1-5186956/trump-election-bond-stocks-investors
'Trump's economic agenda faces a big potential foe: The bond vigilantes'
'Bond prices have dropped sharply since Trump's election as investors worry that his economic policies will reignite inflation and lead to surging fiscal deficits. And that matters...
The U.S. bond market is the biggest in the world, and all kinds of interest rates are tied to how the market performs. When bonds drop, it can hurt the U.S. by making it much more expensive for the government to borrow money. And it affects regular Americans, too, by jacking up the cost of loans, from mortgages to car payments. A lot of people also hold bonds in their investment or retirement portfolios so they could face potential losses...
That gives bond investors big influence and they can use to it to try to hold governments accountable and force them to reverse their economic policies. The market even has a term for investors who exert pressure in this manner: bond vigilantes....
Changes in bond prices affect the interest due on that bond. It's a simple rule: Bond prices and yields move opposite from each other. When bond prices rise, their yields fall, meaning investors are happy to accept lower interest payments..Changes in bond prices affect the interest due on that bond. It's a simple rule: Bond prices and yields move opposite from each other. When bond prices rise, their yields fall, meaning investors are happy to accept lower interest payments. But when bond prices fall, their yields rise, since investors demand more interest as compensation.'