I have a morning schedule, so I'm just going to give

I have a morning schedule, so I'm just going to give you a quick comment. The 10-year U.S. Treasury has gone up at a fast pace. It's five percent on a 10-year basis. It's at 4.995 percent. By March this year, it was at 3.3 percent. It's a jump-up of almost 1.7 percent. It could be a significant loss in bond investment. And there was a speech from Powell the previous day that the recent 10-year rise in interest rates seems to reflect expectations for growth in the United States, and I think it's driven by the rise in term premiums. Rather than the Fed's rate hike stance, there's anxiety that interest rates might go up unchecked in the future. That kind of uncertainty means that we're asking investors who want to tie up money for the longer term to pay off higher rates.

And even if the Fed doesn't tell you, it reflects the anxiety that interest rates could rise in the future. In the decade since the financial crisis, people have thought, interest rates are not going to rise. They're not going to rise. They're going to fall into a swamp of strong deflation. But now, that belief that interest rates are not going to rise. They're not going to be able to get out of the low forever. And even if the Fed doesn't have to step up, if the market rates are going to come up, the Fed won't have to worry about further interest rates. They're tightening themselves..

And even if the Fed doesn't play a big role, the market tightens on its own… And the short- and long-term interest rate gap in the United States, which has widened significantly in the process, is shrinking at a rapid pace. The two-year and 10-year interest rate gap in the United States, which was once reversed to 110bp, has narrowed significantly. As of today, it's only maintained a gap of almost 17bp. So, two-year interest rates haven't risen significantly. Ten-year rates have been rising at a fast pace. Usually at the end of rate hikes ... the market expects a quick rate cut from the Fed, with a slowdown in the economy ... which leads to a sharp drop in long-term interest rates. But that pattern isn't working, at least this time. Long-term interest rates are rising.

If you look at the patterns of the past 20 years, once the Fed started cutting interest rates, it used to cut really fast. Again, after the last rate hike, the rapid shift in posture and the expectation of an increase in asset prices... This was a big thing. If there's a sharp rise in asset prices, there's nothing to worry about. That's what pushes the recession back ... and continues to be the driving force behind consumption. Strong confidence appears in the economic players. But now that confidence seems to be being diluted a little bit. Even though Powell confirmed the previous day that it was almost the last phase of the rate hike, there was no sharp decline in long-term interest rates.

Long-term interest rates continue to push up despite comments from Fed hawks like Christopher Waller and Lori Logan, who used to be very welcoming to all these dovish comments, but now they're somewhat sympathetic to Higher for Longer, and the Fed's appeal is also weakening somewhat. And the Fed's dot plot, which is coming out in March, June, September, December, has been enough to make the market laugh, because it's not going to be able to raise it that way, because it's a bunch of puffers that no one else agrees with. And in June, the Fed was expecting a base rate of 4.6% at the end of next year, which is, oh my God, I'm going to lower it, but I'm wasting it again. And now the outlook for the end of next year is at 5.1%. And the Fed's futures market is expecting about 4.8%, and the gap between the Fed and the market, which used to be very large, is rapidly narrowing, as if the short- and long-term interest rate gap is narrowing. Yeah, the market is responding to the Fed, and it's kind of nervous on its own, even if the Fed throws a kind pigeon…

If you're very strict ... students won't let go of their tension even with a little smile. When the market believes in the Fed ... when it recognizes that there's a Fed that can keep inflation under control ... it destroys inflation expectations. So we can keep inflation under control. So we can expect better growth in a world where inflation is gone. Markets responding to the Fed. No. The market being dragged into the Fed seems to be the heart of today's essay. We'll say hello to you in a weekend essay. Thank you.