Paulson Says US Should Prepare for a 'Vicious' Bond Crash

Hank Paulson warned that US authorities should prepare a back-up plan to avert a potential collapse in demand for Treasuries. The comments highlight stress risk in the government bond market and possible liquidity disruption, with implications for yields and broader risk assets. The message is precautionary and suggests concern over sovereign-debt market functioning rather than an immediate policy action.

Analysis

Hank Paulson warned that US authorities should prepare a back-up plan to avert a potential collapse in demand for Treasuries. The comments highlight stress risk in the government bond market and possible liquidity disruption, with implications for yields and broader risk assets. The message is precautionary and suggests concern over sovereign-debt market functioning rather than an immediate policy action.