Ahead of today's highly anticipated Treasury buyback announcement - which put a number to the shocking Aug 19 news from the Treasury that the maximum size of $2 billion per longer-dated buyback operation would be "at least $4 billion" - we warned that no matter what was unveiled at 11am ET, the market would be disappointed...
Bessent will reveal the expanded Treasury buyback size at 11am ET. It will disappoint.
— zerohedge (@zerohedge) September 9, 2026... for the simple reason that when it comes to $2+ trillion in gross issuance every year and hundreds of billions in annual duration (DV01) supply, $4 billion - or even $10 billion as some expected - would be a drop in the bucket as this chart from Goldman shows (where if you use a microscope, you can even see the size of the TSY buyback in context).
So at precisely 11am, the Treasury did release the long-awaited number.... and it was a huge disappointment.
The treasury announced that going forward, the maximum par amount of 20-30 Year TSYs to be repurchased would be $6 billion... which while more than the $4 billion guaranteed minimum per the original press release, was less than the $10 billion whisper.
Source: TreasuryMany dealers had ramped up their predictions for Thursday’s buyback operation after Bessent publicly touted the potential for purchases of over $4 billion; many expected $6 billion, a few even said that a number north of $10 billion isn't out of the question. The Treasury chief on Tuesday reiterated that while he cannot alter the “equilibrium” price of Treasuries, his objective was to slow moves down and prevent any damaging narrative taking hold in the world’s biggest bond market
BNP Paribas head of US rates strategy, Guneet Dhingra, said before the announcement it would take a maximum size of $7 billion to surprise the market, with anything less triggering selling pressure. He was right: the $6 billion number proved to be a dud as confirmed by the bond market reaction which has sent 10Y yields spiking 4 bps higher on the disappointing news, rising as high as 4.85%.
How successful the enlarged program will prove remains to be seen. Yields dropped after the initial announcement of the plan last month, but retraced the move. Benchmark 10-year yields last week hit their highest since 2023.
Markets in August, when 30-year yields hit their highest since 2007, were driven by concerns “the US is not going to be able to pay its debt. It was absurd, but it just became kind of the dominant narrative,” Bessent claimed in a Texas event. He has separately characterized buybacks as aimed at boosting liquidity. They will enable banks and other institutions to offload harder-to-trade securities so that they can then boost their participation in auctions of new debt, he said last week.
“Scott has absolutely adopted a very activist model as Treasury secretary,” Krishna Guha, head of economics at Evercore ISI, said before Wednesday’s announcement. “He’s tactically very skilled in terms of when and how to surprise and move markets and has had some near-term success.”
Guha, who previously worked at the Federal Reserve Bank of New York, said “the challenge is always whether the impact of these kind of interventions can be sustained without bigger changes in fundamentals.”
Of course, since the buyback size is a "maximum", that means the Treasury will not necessarily purchase that amount of securities. However, when it comes to buybacks targeting longer-dated nominal debt, the department does tend to buy the full size, having only twice not done so in the 52 such operations since the program was reintroduced in 2024.
Bessent’s expansion of the long-dated buybacks program last month took investors by surprise because it was announced outside the Treasury’s quarterly announcement schedule. That’s fanned talk of a new, more activist style of US debt management, in contrast to the department’s long-held mantra of being “regular and predictable.”
Tyler Durden Wed, 09/09/2026 - 12:55Authored by Zachary Stieber via The Epoch Times,
The Justice Department on Sept. 8 requested that the Supreme Court let the government verify the citizenship of voters using a federal immigration database.
A federal judge earlier in the year ruled that the Trump administration was violating privacy laws by using the Systematic Alien Verification for Entitlements (SAVE) system to verify the citizenship of people on state voter rolls.
An appeals court upheld the ruling on Sept. 4 in a split decision, with the majority concluding that using the database would illegally disclose personal data such as Social Security numbers.
"The district court has issued an indefensible order that threatens the integrity of upcoming elections by vacating the federal government's authority to internally use Social Security data when fulfilling its duty to respond to requests by states to verify the citizenship of individuals for voting and other purposes," Department of Justice lawyers wrote in the new filing to the nation's top court.
They said the order exceeds the jurisdiction of the court, because the organizations that brought the lawsuit do not have standing, or are not affected by the order in a way that allows them to legally challenge it.
"The court's order also fails on the merits, as the policy is consistent with all applicable federal statutes," the filing states.
"The order will irreparably harm the federal government, the States, and the public by depriving the government of an effective tool to verify the eligibility of registered voters and benefits applicants under various state and federal programs."
The groups that brought the litigation, including the League of Women Voters, have not yet responded to the filing.
The litigation was brought after the government enabled bulk queries to SAVE, complying with an order from a different judge that came in a case brought by states that struggled to verify the citizenship of registered voters.
Although a majority of a U.S. Court of Appeals for the District of Columbia Circuit panel on Sept. 4 ruled in favor of the groups, Judge Gregory Katsas dissented. He said that he would have stayed the order blocking the government from using SAVE, pending the outcome of the appeal.
The government's modified system does not appear to violate the federal law that prohibits disclosure of Social Security numbers and "related records," according to the judge. He said that the disclosures would only be made to the Department of Homeland Security, which would then convey information about a person's immigration status or citizenship to state agencies.
"In sum, SAVE responses are not 'related records' because they simply repeat identifying information provided by the SAVE user, in the course of conveying any additional, unprotected information about the identified individual's citizenship status," Katsas wrote.
Tyler Durden Wed, 09/09/2026 - 12:40