In econo-jargon, the word "real" typically refers to "inflation-adjusted."  So when we say that "real 10yr yields" hit record lows this morning, it could mean that bonds had a reason to rally or simply that inflation is rising massively.  Spoiler alert: it's the latter.

In other words, regular old 10yr yields are higher this morning.  Inflation adjusted yields are only at record lows due to a big spike in inflation, and even then only because "inflation-adjusted" relies on TIPS (Treasury inflation-protected securities) trading levels and TIPS didn't get started until the 90s.

20211110 open1.png

20211110 open2.png

Interestingly enough, most the current losses were already intact during the overnight session. After mixed signals on the first 2 days of the week, we'll get a better sense for current momentum as the market approaches and ultimately digests this afternoon's 30yr bond auction.  That will be the last meaningful event of the week before tomorrow's holiday closure and Friday's anticipated "ghost town" trading conditions.