Sushi CEO Alex: High Yield of 30-Year U.S. Treasuries Reflects Attractiveness of U.S. Stocks
Alex stated that the historic high yield of 30-year U.S. Treasuries has triggered bearish posts, but it may only reflect the risk premium of not investing in the world's strongest economy.
He believes that the related concerns are exaggerated, and the value of holding U.S. stocks is too high to miss.
In the current economic phase, investing in monopolistic companies with compounding effects is clearly superior to bonds, thus bonds must offer higher yields to attract capital.
This viewpoint addresses recent market discussions regarding the 30-year U.S. Treasury yield rising to about a 19-year high.
Market mechanisms are reassessing the relative attractiveness of stocks and bonds driven by events: capital continues to flow into U.S. growth and monopolistic assets, forcing bond yields upward to balance capital allocation, while long-term rates are pressured, enhancing stock market valuation support.
Additionally, the author emphasizes the structural advantages of the U.S. economy and corporate earnings.
Source: Public Information
ABAB AI Insight
Market participants interpret the rise in long-term U.S. Treasury yields as an opportunity cost for U.S. stocks rather than a simple risk signal, reflecting a phase shift in stock-bond pricing logic.
In terms of capital allocation, resources are prioritized for equities of companies with pricing power and compounding ability, motivated by capturing excess returns from the U.S. economy under innovation and monopolistic structures, forcing fixed income to increase compensation.
Similar cases can be seen in the late 2010s when U.S. stocks long outperformed bonds, and the valuation expansion led by tech giants; currently, we are in a phase dominated by stock premiums, with bonds passively conceding.
The structural judgment indicates a transfer of pricing power: the attractiveness of equities to capital outweighs traditional safe-haven assets, with the mechanism being the increased cash flow certainty of monopolistic companies, necessitating an upward shift in the risk-free rate to compete for funds.
ABAB News · Law of Cognition
High stock returns force concessions in the bond market
Monopolistic compounding outweighs interest rate levels
Opportunity cost determines asset pricing