Trump, Bessent & The Bond Vigilantes 

The bond market reacted favorably to Trump’s pick for Treasury Secretary, Scott Bessent, suggesting receding concern about the federal budget deficit—as he has a plan to get the deficit under control. That should appease the Bond Vigilantes. We also like Bessent’s “3-3-3” plan, which might boost US economic growth and improve the perilous fiscal outlook. That should set the stage for a continuation of our Roaring 2020s scenario for the rest of the decade. … Also: Eric discusses a potential normalization of the yield curve. We think it may be flatter than in past easing cycles, much as it was during the last half of the 1990s.