Feldstein: Bond Vigilantes Are Finally Showing Themselves

The video discusses the emergence of bond vigilantes and their impact on interest rates, highlighting the unsustainably low long-term rates due to monetary policy. It anticipates a normalization of these rates and examines the Fed's influence on the bond curve. The discussion shifts to the potential market impact of price declines, noting that some investors may not be affected due to their investment strategies.

What role do bond vigilantes play in the context of monetary policy?

How have long-term interest rates been affected by the actions of the Fed?

What is the significance of price analysis in relation to yield analysis?

In what ways might price declines impact American behavior according to the discussion?

What are the potential reactions of investors to positive yield despite price declines?