Andy Constan, CEO of Damped Spring Advisors, expressed strong disagreement with the U.S. Treasury's debt management strategy in a post on X today, Wednesday, October 28, 2026. Constan stated, "It really is quite amazing that the treasury thinks it's a good idea to issue 444BN of 20 and 30 year nominals annually AND buyback 192BN of off the runs 20 and 30 year debt for a net new issuance of 252BN when the deficit is growing and running at 1800BN per year. Net issuing only 14% of the deficit in long term bonds at 5.25%. I'd be pounding the long end at current term premium and nominal demand and swap spreads very health."
Constan's comments come as the U.S. budget deficit remains a prominent economic concern. Recent Gokhshtein coverage included Constan's view that Scott Bessent, the Treasury Secretary, is suppressing long-term interest rates. Earlier reporting from Jason Furman noted that Treasury markets appeared unchanged since the last Federal Open Market Committee (FOMC) meeting. Liz Ann Sonders also reported elevated consumer inflation expectations, adding to the fiscal backdrop.
Constan's analysis implies that the Treasury's current approach to debt issuance is insufficient to fund the growing deficit, particularly regarding long-term bonds. His position suggests that the market is mispricing the long end of the yield curve given the current term premium and demand dynamics, indicating a potential opportunity for investors to buy long-term debt at current rates.
