Bessent's Former Mentor Druckenmiller Slams Treasury Bond Buyback Plan
Billionaire investor Stanley Druckenmiller called Treasury Secretary Scott Bessent's bond buyback plan a mistake. He argued governments that fight market fundamentals always lose.
Druckenmiller mentored Bessent early in his hedge fund career. He made his case in a Wall Street Journal opinion column.
Why Druckenmiller Pushed Back
Druckenmiller was responding to Bessent's push to expand bond purchases. Treasury said it would at least double its buyback operations. That lifts the ceiling from $2 billion to $4 billion per operation, starting September 9.
"Governments defending prices against fundamentals always lose," Druckenmiller wrote.
He argued that markets aggregate information no committee can replicate, and that the long-term Treasury yield checks government borrowing. Removing that check, in his view, removes fiscal accountability.
The intervention followed a sharp climb in the 30-year Treasury yield. It touched its highest level in nearly two decades before the buyback announcement. The national debt also surpassed $40 trillion this week.
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