JPMorgan Asset Management: Long-End Treasuries Have Reached "Maximum Pain Point," Initiating Purchases
nashnova research
JPMorgan Asset Management CIO Bob Michele says his team has started buying long-dated government bonds in the U.S., Japan, and Australia, calling prices 'just too cheap' and the market at maximum pain — a signal that one of the world's largest asset managers sees the long-bond selloff as overdone.
What exactly did they buy — and why now?
Michele's team has started buying long-dated government bonds in the U.S., Japan, and Australia, citing prices that are "just too cheap."
This means → the bet is not on any single country's bond market but on a single thesis: global long-end rates have peaked.
In plain terms = long-term bonds have been falling for a while; JPMorgan Asset Management thinks the drop has gone too far and is stepping in.
What makes him think this is the turning point?
Michele frames the ECB's rate hike last week, the Fed's hike this cycle, and the Bank of Japan's move on Friday as a critical policy sequence supporting bonds, saying "the dominoes are starting to fall."
He also sees Middle East tensions stabilizing ahead of the midterm elections as another key support.
This means → his logic chains two forces: the global central-bank tightening cycle is nearing its end, and geopolitical risk is cooling — both pointing toward a bond-market floor.
Why does the Treasury buyback program matter?
Michele notes that Treasury Secretary Scott Bessent's long-bond buyback program, launched last month, is an important stabilizing force.
He adds that Bessent "has enough ammunition to do more, if he chooses."
In plain terms = the Treasury is buying back its own long-dated bonds from the market — effectively pumping the brakes on the selloff. And those brakes are not yet fully pressed; there is room to push harder.
What does the surge in long-end yields actually tell us?
Ten-year and 30-year Treasury yields rose to multi-year highs before the Fed's hike; Michele believes the move has been excessive.
He warns that the rapid climb in long-end yields "highlights the market's concern that the Fed has lost control."
This reflects a deeper signal: the market is not pricing economic data — it is pricing a crisis of confidence in whether the central bank can steer the situation. The hike's real purpose, in Michele's view, is to help the Fed "re-establish the image that it is in charge."
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