Until Wednesday morning, the performance of the 30 -year -old government bonus of the United Kingdom rose to 5.6%, its highest level since 1998, which causes a broader increase in the sovereign yields of the United States and caused new concerns about the stability of the financial market.
Increased yields of global bonds exert significant downward pressure on risk assets. Since the sale of US shares began. UU. Last Thursday, Nasdaq has fallen by 10%, while Bitcoin (BTC) has been a little better, 8% less in the same period.
At the same time, the yield of the 30 -year -old bonds of the United Kingdom has increased by 8%, while the 30 years of the United States. Charlie Morris, founder of Bytetree, believes that investors will begin to seek diversification in other assets, including Bitcoin.
“It seems that the United Kingdom has been living beyond its means for too long. It has not balanced its budget since 2001, the golden market has had enough,” said Morris. “Investors looking for diversification far from financial assets will not only buy gold, but also in Bitcoin.”
The dramatic increase in yields has revived disturbing memories of the 2022 pension crisis of the United Kingdom, when a sudden increase in the costs of indebtedness triggered a close collapse of the financial system and, ultimately, cost the then Minister of First Liz Truss his work.
This last agitation of the bond market is being driven by increased uncertainty around global trade, fueled by the tariff plans proposed by President Donald Trump. These levies could interrupt the global supply chains and increase costs, adding pressure to the markets already nervous.
“Unfortunately, in politics you never get what you want when making civil arguments from the high principle,” said former United Kingdom Deputy Steve Baker A Coindesk in an exclusive interview. “President Trump said he was using gross economic force, and it is. It is time to rediscover free trade in the home and abroad, fast, before this chaos destroys our future.”
The recent increase in performance echoes the events of 2022, when a surprise of mini budget on September 23 sent golden yields, crashed the pound and presented deep vulnerabilities in the United Kingdom’s pension system.
Many defined benefits pension schemes had adopted complex investment strategies promoted by responsibility (LDI), using leverage and derivatives to match long -term liabilities. But as the yields shot, these funds suffered mass brand losses to the market and faced margin calls, forcing rapid gold sales in a thin market and creating a feedback loop for “fire sales” destabilizing.
At that time, the United Kingdom’s pension funds had about 28% of the golden market. The resulting chaos, which occurs in a modest market of $ 1.5 billion, was so severe that it required that the Bank of England intervened with golden emergency purchases to stop the descending spiral. TO Fed with Chicago Analyze the crisis then identified excessive leverage, asset grouping and limited depth of the golden market as key structural weaknesses, particularly in contrast to the United States Treasury market of $ 9.9 much larger.
