This Treasury Strategy Could Backfire on Fed — Top Economists Warn Scott Bessent Is Mucking With a Critic

Top economists are sounding the alarm over Treasury Secretary Scott Bessent‘s expanded bond buybacks. Wharton Professor Jeremy Siegel has dubbed the yield curve manipulation the “Bessent twist,” while veteran strategist Ed Yardeni warns the intervention will “muck up things” for the Federal Reserve’s upcoming policy decisions.

The “Bessent Twist” and Damaged Credibility

In a recent weekly commentary, Siegel expressed strong reservations about Bessent’s strategy to alter the relative supply of short- and long-term securities.

He explicitly criticized the effort to influence the slope of the yield curve. “I call this the ‘Bessent twist,’ and I do not think it is a good idea,” Siegel wrote. The core issue, according to Siegel, is a looming policy clash.

While newly appointed Fed Chairman Kevin Warsh emphasizes allowing markets to send authentic economic signals, the Treasury appears interested in deliberately altering those very signals.