Name: Bondholders, not the Fed, will decide how high US yields go: Investor
Uploaded: 2026-10-05T04:12:49Z
Duration: 4 min 17 s
Description: David Kuo of The Smart Investor says U.S. Treasury yields could rise above current levels if bondholders lose confidence in America's fiscal discipline. While 5% Treasury yields may appeal to some investors, he says he prefers a portfolio of dividend-paying stocks that can generate income that grows over time.

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Bondholders, Not the Fed, Will Decide How High US Yields Go — Investor

Bullish Gator

Oct. 5, 2026

Investor David Kuo: bondholders—not the Fed—will determine US Treasury yields; fiscal confidence could push yields higher. He favors dividend-paying stocks for growing income over relying on 5% Treasuries.

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What stands out

David Kuo of The Smart Investor makes a striking claim: bondholders, not the central bank, will set the ceiling for U.S. Treasury yields if they lose faith in fiscal discipline. He highlights a scenario where yields climb past 5 percent because market participants demand higher compensation for holding government debt. Kuo also contrasts that outcome with his preference for dividend-paying stocks, arguing they offer an income stream that can grow over time rather than a fixed Treasury coupon that may be eroded by rising rates.