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There's some market symbolism that I'm in green and Stacy's in red actually.
Oh, I don't want to be market losses.
John Arthurs is an opinion columnist at Bloomberg and friend of the show.
John, thank you for joining us. It's a pleasure to be here.
If you were at a dinner party with people who didn't know that much about bonds
and they asked you, why should we care about this right now?
I'm hearing a lot about this. What would you say?
Okay, first of all, you seem to have a remarkably good insight into my social life, which I'm very impressed by.
Are people cornering you asking you about the bond market?
I would say it needs to matter because globally no number matters more than the 10-year Treasury yield.
And it matters because it's not just about how much Uncle Sam has to pay to borrow,
but it is treated across the world as the closest approach we have to a risk-free rate.
The US government is not going to default unless it renounces its ability to print new money.
There's a risk of inflation, there's no risk of default. It is the safest loan you can make to anybody.
You can put your money in US bonds, you know you will get it back.
And governments and investors all over the world count on it for that.
Exactly. So this is as close to a risk-free rate as exists
and so it's written into spreadsheets across the planet as the risk-free rate
onto which you then add more to take account of the extra risk that goes with lending to Britain or Germany,