The bond market has been sending us warning signs. I sat down with Monetary Economist EJ Ume from Miami University’s Farmer School of Business to explain what is happening and what it means to you. If you don’t already do so, make sure to connect with EJ on LinkedIn.
We would love to hear your thoughts on this conversation.
Here is what we discussed
EJ walks through three forces pushing long-term yields higher
EJ's research and how monetary policy is a "blunt instrument" that hits different people differently
Stablecoins and what you need to know about them
Career and teaching: EJ's path from Wall Street into academia
Papers Referenced
Ume, E. (2025). Racial Disparities and Monetary Policy: Evidence from Augmented Taylor Rules. Economic Letters, 257, 112692. https://doi.org/10.1016/j.econlet.2025.112692
Ume, E., & Williams, M.J. (2018). The Differential Impact of Monetary Policy on Blacks and Whites since the Great Recession. Journal of Economics, Race, and Policy, pp 1-13.
Burgess, O. & Ume, E. “Stablecoin Flows and Money Market Conditions.” Under review
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My discussion last week with economics_BS sets up a lot of what EJ and I talk about this week. If you haven’t already, make sure to catch up on this episode too.
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Treasury just doesn't have enough liquidity to make any real move without The Fed aligning on the end goal. If Bessant is playing some game with dollar dominance via weakening its purchase power and hoping that exports will help fill the coffers, we're in trouble.
Stablecoin are popular to avoid sanctions. Russia has moved Billions via stablecoin to circumvent US Banking Sanctions. The GENIUS Act does little/nothing to create an enforcable mechanism to handle mixers or decentralized-finance platforms.