The bond market looks through 'intervention'... Yields rise again... The spin zone... We've seen this before... Walmart's earnings show a hurting consumer... Moderna is back... Dave Lashmet was on it... Bitcoin gets a boost...
And that didn't last long...
Yesterday, we wrote to you about the Treasury Department's plans to double its "bond buybacks" pace. Retiring debt is an attempt to control the longer end of the yield curve, as 30-year and 10-year Treasury yields recently hit multidecade highs.
At an auction on Friday, the U.S. Treasury sold $25 billion worth of 30-year bonds at a 5.216% yield, the most expensive 30-year bond sale since 2001. Even at that interest rate, demand was weaker than expected.
Then came a move from Treasury Secretary Scott Bessent yesterday...
He said the Treasury plans to double the pace of bond buybacks to $4 billion at a time. It's set to start on September 9 and run until the day after the midterm elections in November. The news sent bond prices surging (and yields lower) – exactly what was intended.
But it didn't kick off a trend.
Today, yields moved higher and essentially erased yesterday's action...
The 10-year Treasury yield is around 4.7%, right where it began yesterday and close to where it has been for the past month.
It's just about the same with the 30-year yield. It's trading around 5.2% as we write, only slightly below yesterday's highs and still within a general uptrend of the summer.
Clearly, the plan hasn't "worked" as Bessent thought. On CNBC today, he floated the idea of doubling down and buying back even more debt.
The Treasury Department is going to "make a market" for long-term U.S. debt, Bessent said in the television interview.
Did he really just say that?
If the U.S. Treasury has to "make a market" for American debt, that means there isn't one already. Sadly, that's no surprise... with the pace of inflation north of 3%, U.S. debt growing past $40 trillion, foreign buyers open to alternatives, and no end of any of it in sight.
Bessent put his best spin on it.
"There's nothing magic about the 40 trillion number, and we can grow our way out of that," he said. "Our message to our allies, our trading partners, is that global growth is the way to take care of this mountain of debt."
He also said that two years ago, when the U.S. debt was "only" at $35 trillion.
The bond market looked right through it.
This reaction is as important to note as the Treasury's move itself...
Mr. (Stock) Market often overreacts in knee-jerk ways to news and developments. But Mr. (Bond) Market is typically ahead of the game at sniffing out what's really going on with the economy and markets... and the risks ahead.
Right now, the bond market is signaling expectations for high(er) inflation ahead. Likely factors include government debt loads, uncertainty about the war in Iran and global oil flows, and increased economic warfare.
President Donald Trump threatened "Economic D-Day" against Iran in a Truth Social post last night.
Oil futures moved higher again today, by more than 2%, in response to continued Iran war fears. Only the energy and real estate sectors of the S&P 500 Index rose, and the major U.S. stock indexes were all lower.
Federal Reserve policy – expected and real – matters, too.
Under new Chair Kevin Warsh, the Fed has kept its benchmark bank lending rate steady. Warsh hasn't raised the federal-funds rate even as inflation numbers are elevated above the central bank's supposed 2% goal and longer-term yields were moving higher as the Fed met last month.
Even if Warsh wanted to raise rates, he's going to face pressure against it and perhaps even do the opposite. As we wrote just on Tuesday, Trump hasn't publicly called for lower rates from his new Fed chair yet. But he could be getting there.
Yesterday, while saying that Warsh is doing a "great job," Trump also said interest rates are "artificially high" and lamented the political nature of the Fed board and those who voted for higher rates at the central bank's previous meeting.
Here we go again...
We've seen this so many times from politicians of various stripes... There is a reason for the "four-year presidential cycle" of market performance...
As we sit here in late August, we're heading toward the midterm elections where those in power in the government once again will "do anything" to win. Part of that is to keep stocks (and bond prices) pushing higher.
That might sound like a good thing for your portfolio – and it could be for periods in some fashion. But it brings consequences to deal with in the long term. That is, foremost, more inflation, more debt, and more erosion of the U.S. dollar's purchasing power.
The second year of a presidential term also typically brings volatility in stocks and the term's worst returns. That includes a 2% average decline in year two of the past six cycles. The environment is also historically favorable for market corrections and bear markets, as we've shared in these pages before.
The "good" news is that we've already seen a correction of around 10% this spring upon the start of the war in Iran. The bad news is that now comes the "fix"... more inflation.
Same story, different day.
Be prepared.
What Walmart said this morning...
The retail giant reported its quarterly earnings this morning, and it wasn't good news.
Walmart (WMT) reported U.S. comparable-sales growth of just 2.6%, its smallest reported quarterly increase since 2020 and the first time comparable sales missed expectations since 2021.
In-store sales were particularly weak. Much of the overall growth came from a 24% increase in U.S. e-commerce sales, a bucket that also includes sales of online ads, not just products.
So overall, the company's earnings report shows an American consumer that's hurting. As the Wall Street Journal reported, everyday folks are increasingly considering where to spend their money... and get the most bang for their buck...
Sales of groceries, toys, fashion and private brands were strong in the most recent quarter, and Walmart said it is gaining market share broadly, but especially among higher-income households, a term the retailer uses to describe households that earn $100,000 a year or above. Lower-income shoppers continue to spend cautiously, but they are spending, said [Walmart Chief Financial Officer John] Rainey. "It appears there were choices between necessities within the quarter because of where gas prices are," he said.
Walmart did raise its full-year sales and operating income guidance – in part due to a tariff refund of almost $3 billion in tariffs from Uncle Sam. Yet the market wasn't listening. It put more stake in the company's relatively low sales growth.
Walmart shares plunged more than 9% to a nine-month low.
Moderna lives...
Elsewhere, advances in biotech and health care are mercifully disconnected from anything about the inflation or debt story.
Along those lines, a shoutout once again to Stansberry Venture Technology editor Dave Lashmet.
In March, Dave recommended shares of Moderna (MRNA). Most investors think of Moderna as a flash in the pan from the pandemic era... Its stock soared on the strength of its COVID-19 vaccine, then crashed once the vaccination wave died down. Nobody thought about it again... except Dave.
In his recommendation a few months ago, Dave said the stock "has the potential to double with its new personalized cancer vaccine." That might sound like science fiction, but it's not.
As Dave and analyst Erica Saint Clair explained, Moderna partnered on the technology with Merck (MRK), another Venture Technology model portfolio holding...
In 2016, Moderna and Merck started a project to develop personalized cancer vaccines. In 2022, Merck paid Moderna $250 million to continue developing the vaccines. This is a 50/50 deal, so Merck and Moderna split costs and profits.
Here's how the vaccine works...
During surgery, doctors cut out tumors from cancer patients. The patient's DNA is then compared with their cancer's DNA to see what makes the cancer different. Using this data, Moderna constructs a unique cancer vaccine with up to 34 proteins from the patient's tumor. The vaccine is injected every three weeks, up to nine times.
Dave and Erica told their subscribers that ongoing trials looked "highly promising." They said if the mRNA technology behind the vaccine worked, it could be worth billions per year.
Yesterday, the rest of the world heard what Venture Technology subscribers already knew...
Moderna and Merck revealed interim trial data showing that a vaccine for people with melanoma, combined with Merck's Keytruda immune-system booster, prevented the cancer from returning or spreading in high-risk patients.
Shares of Moderna surged by 177% in a single day, adding roughly $40 billion to its market cap.
As of today's close, shares are well above Dave and Erica's recommended buy-up-to price and 150% higher since their initial recommendation. It's a similar story with Merck, in which subscribers are sitting on a gain of around 100%.
Dave and Erica updated subscribers yesterday...
Now, the trial is only halfway completed. And we haven't seen the data yet. The companies said they expect to present it at an upcoming medical meeting. But for now, we know Moderna and Merck have the first personalized cancer vaccine to help patients more than just Keytruda alone.
The U.S. Food and Drug Administration has already granted this vaccine a "Breakthrough Therapy" designation. With positive pivotal data and the long-term Phase II data, we could see Moderna and Merck apply for approval within the next year.
In short, Moderna could soon have a drug worth billions of dollars a year – especially if it's as successful in other cancers. Moderna and Merck are already running trials in lung, kidney, and bladder cancers. That's great news for both companies, and it's why shares are soaring.
Venture Technology subscribers can find the entire update on this story here... If you take nothing else away today, make it this: Moderna is not just the COVID-19 vaccine company anymore.
Bitcoin may be next for the White House portfolio...
At an event at the White House last night, President Donald Trump continued to show why he says he's the most pro-crypto president in history.
At a press conference with crypto executives and financial regulators, Trump said that the government may make "sizable" bitcoin purchases.
The White House has already established a "Strategic Bitcoin Reserve" through an executive order. But this comment is much different, and requires some unpacking, so we went to our Crypto Capital editor Eric Wade for his take.
Eric explained in a private note this morning...
Trump's comments lit a fuse because they changed the identity of the potential buyer. The federal government already holds bitcoin it seized. A deliberate purchase program would turn Washington from an accidental holder into a strategic accumulator.
Trump stopped short of announcing one, but confirming that "sizable" accumulation has been discussed forces the market to price a new demand source against a famously limited supply of just 21 million coins.
That sent the world's largest crypto soaring... Bitcoin is up roughly 10% since yesterday morning to around $72,000, its highest level since June 1.
Trump also called for Congress to speed up its work on the CLARITY Act, which would set up a comprehensive regulatory framework for cryptocurrencies.
But as Eric wrote to us this morning, it's not a done deal yet. The bill still faces a procedural vote on September 15 if it doesn't receive the 60 votes in the Senate needed to pass that hurdle.
But that's not to say that no progress has been made. As Eric wrote in this week's Crypto Capital, the Treasury Department recently proposed new guidelines for stablecoins. More from Eric...
On August 17, the Treasury Department published a proposed rule under the GENIUS Act, which would define when a stablecoin is considered issued, offered, or sold in the U.S. The broader framework is still expected to take effect in 2027, but the proposal gives us another concrete step toward clearer stablecoin rules.
While things are moving slower than President Trump and many crypto investors may hope, the industry is still moving toward a clearer regulatory picture. But that's not what excites Eric about this week's move.
Eric is focused on how bitcoin is rallying in the face of record shorts. On Wednesday alone, when bitcoin's latest rally really took off, $2.7 billion worth of leveraged short positions got liquidated, according to Eric. And $1 billion of that came within one hour.
As he concluded in today's note...
Rallies tell us a lot more when they arrive against resistance... which a record number of shorts certainly qualifies as.
Bitcoin has broken out of its ten-week channel... now it needs bulls to hold on.
Said another way, this could be the beginning of the next leg higher after bitcoin's consolidation around $60,000. After bitcoin fell 50%-plus from all-time highs in October 2025, a new four-year cycle for the world's largest cryptocurrency could be beginning.
It doesn't hurt that the market is simultaneously recognizing a loss of faith in the dollar again.
New 52-week highs (as of 8/19/26): AbbVie (ABBV), Amgen (AMGN), ProShares Ultra Nasdaq Biotechnology (BIB), Bristol-Myers Squibb (BMY), Maplebear (CART), Pacer U.S. Cash Cows 100 Fund (COWZ), Quest Diagnostics (DGX), Cambria Foreign Shareholder Yield Fund (FYLD), Global X MSCI Greece Fund (GREK), iShares Biotechnology Fund (IBB), IQVIA (IQV), Johnson & Johnson (JNJ), Coca-Cola (KO), Eli Lilly (LLY), Invesco High Yield Equity Dividend Achievers Fund (PEY), Roivant Sciences (ROIV), USCF SummerHaven Dynamic Commodity Strategy No K-1 Fund (SDCI), State Street SPDR Portfolio S&P 500 Value Fund (SPYV), Twist Bioscience (TWST), and State Street Health Care Select Sector SPDR Fund (XLV).
In today's mailbag, more thoughts on the "shape" of the economy. Some of you don't think it's a "K" or a "C" or any other single letter, but an acronym... Do you have a comment or question? As always, e-mail us at feedback@stansberryresearch.com.
"Corey, Double kudos to Alliance Member, Greg F and Subscriber Sherwin R for the new economy acronym, BSPOBS ['big steaming pile of BS'].
"Let's all please be sure we annunciate it properly: BS-POBS. Like POGS, with a B. Remember those stupid chip-like things from the 90's?
"About as stupid as our economy is getting... LOL!" – Subscriber Steve R.
Corey McLaughlin comment: Sounds like a movement starting to me... And, yes, I remember Pogs. I had a few, but even in the '90s, I wondered about the hype for disks of cardboard. They're not worth much now, but maybe demand will make a comeback.
All the best,
Corey McLaughlin with Nick Koziol
Baltimore, Maryland
August 20, 2026
