The yield curve has always been controlled by the Fed, and this remains the case. No one has lost control. The yield curve is the time path of short run rates, adjusted by risk. So, for example, if the market thinks inflation will rise -- for example because of a foolish war against Iran -- then they will sell the long dated bonds because they know the fed will hike rates in the future, making the long dated bonds less valuable, and they want to get ahead of that. If, on the other hand, they think inflation will be too low, they will bid up the longer dated bonds because they expect the Fed to lower rates in the future, making the long dated bonds more valuable. The entire bond market is fixated on trying to guess what the Fed will do next, so that is why they peer at the economic data and try to guess in which direction the Fed will move and when. That is the opposite of "losing control" of the yield curve.
The problem is Bessent trying to control something that he has never had any control over, by jawboning the market and doing silly things like trying to intervene. Bessent is the Treasury secretary. Treasury does not, and never has, controlled the yield curve. Whatever games he plays buy buying and selling bonds has only a short term psychological effect on the market, and soon people brush it off.
The Fed controls the yield curve, not Treasury.
Bessent is a hedge fund guy that is really not well suited to the role he is playing. Now, they want to put Bessent in charge of economic sanctions against Iran, when we shouldn't even have any sanctions against Iran. The US is sanctioning the world's top oil producers, and then complaining about oil shortages.
