Why Rising Global Bond Yields Are Worrying Investors

Summary

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WSJ What’s News – Why Rising Global Bond Yields Are Worrying Investors

Date: September 3, 2025
Host: Alex Osola
Guests: Spencer Jacob (WSJ Investing Columnist), Vicki Go Hwang (WSJ Crypto Reporter), Inti Pacheco (WSJ Data Reporter)

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Overview

This episode centers on the recent surge in global bond yields, why it’s unsettling markets, and what it signals about government finances worldwide. Additional segments cover the slowing US labor market, the Trump family’s growing involvement in the crypto sector, Florida’s planned elimination of vaccine mandates, and a deep dive into the makeup of America’s billionaires.

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Key Discussion Points & Insights

1. Rising Global Bond Yields: Investor Anxiety & Government Debt

[00:35–04:45]

• Why are bond yields rising?

  • Host Alex Osola introduces the topic by noting that yields on 30-year UK gilts hit their highest level since 1998, with similar multi-decade highs in France and Japan. The US 30-year Treasury briefly topped 5%.
  • Spencer Jacob explains that this reflects anxiety over government borrowing and investors’ willingness to take on long-term risk:

    "You're taking the most risk because inflation has the most potential to destroy the value of those bonds." — Spencer Jacob [01:36]
    Investors, normally large entities like pension funds and insurers, are also uneasy.

• What’s unique in developed markets now?

  • Rare alignment: Rising bond yields and sinking currencies, usually seen in emerging markets, now appear in the UK:

    "Generally, people are looking to put money to work...when those interest rates rise ... and the currency sinks, then you know you have a problem." — Spencer Jacob [02:15]

• Why is this alarming?

  • Old bonds with low interest rates are rolling over into new, higher-interest debt, making government borrowing costlier:

    "The U.S. for example, pays a trillion dollars a year in interest. A trillion dollars. That's more than the entire defense budget." — Spencer Jacob [03:12]

• What could calm markets?

  • True fiscal austerity (raising taxes, cutting spending) is unlikely, especially in the US.
  • Jacob warns the worst would be central banks helping governments by financing deficits, effectively printing money:

    "We're really entering a kind of a dangerous territory there...that's tantamount to money printing. And that would possibly unleash a lot more inflation ... That is the real nightmare scenario." — Spencer Jacob [03:55]

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2. US Labor Market Update

[04:55–05:32]

• Job openings slipped to 7.2 million in July, indicating a slowing but not collapsing labor market.
• Listeners are primed to watch for the upcoming August jobs report for more current data.

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3. US Markets and Gold Performance

[05:32–05:58]

• The Nasdaq outperforms (up 1%) with Alphabet and Apple leading gains.
• The S&P 500 also up (0.5%), Dow flat.
• Gold futures hit a record: $3,593.20 per troy ounce.

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4. Trump Family’s Crypto Expansion: American Bitcoin

[06:53–08:40]

• American Bitcoin, a mining and accumulation company backed by Donald Trump Jr. and Eric Trump, begins trading on the Nasdaq, closing up 17%.
• Vicki Go Hwang explains the business model:

  "What it does is it mines bitcoin...also...is to accumulate bitcoin. You buy Bitco and put it on your balance sheet and try not to sell bitcoin, which is famously volatile." — Vicki Go Hwang [07:17]

• The Trumps are “trying to reach into every corner of the crypto market.”

  "The Trump brothers...hope that retail investors can access these opportunities." — Vicki Go Hwang [07:57]

• Public listing profits the Trumps directly:

  "Both Eric Trump and Donald Trump Jr hold shares in the company. So by bringing this company to the public market, their stake will be worth a substantial sum." — Vicki Go Hwang [08:24]

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5. Crime & Vaccine Mandates: Policy Updates

[08:44–10:13]

• President Trump hints at expanding National Guard presence to New Orleans for law enforcement assistance.
• Florida proposes to eliminate all vaccine mandates, including for schoolchildren, making it a state-level first.
• Experts warn this move undermines public safety.

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6. America’s Billionaires: Who Are They?

[10:13–12:19]

• There are now 1,135 US billionaires (up from 927 in 2020), collectively worth about $5.7 trillion.
• Data Reporter Inti Pacheco challenges common stereotypes:

  "More of them actually made their money in finance or banking...there's people who became billionaires maybe in oil, maybe in roofing, maybe in chocolates. They definitely skew older." — Inti Pacheco [10:28]

  • 85% are men, many over age 65.
• Inheritors hold significant wealth:

  "A lot of families or dynasties ... like the Walton family...the Kochs...the Pritzkers...the Mars family...held about 15% of the total wealth." — Inti Pacheco [11:03]

• Philanthropy is common, but not universal:

  "There's a lot of education, a lot of...medical research. It's very common for billionaires to give away a lot of their money. But there were hundreds...that hadn't given any money in the past 10 years, at least publicly." — Inti Pacheco [11:55]

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Notable Quotes

• "You're taking the most risk because inflation has the most potential to destroy the value of those bonds." — Spencer Jacob [01:36]
• "The US pays a trillion dollars a year in interest. That's more than the entire defense budget." — Spencer Jacob [03:12]
• "We're really entering a kind of a dangerous territory ... that's tantamount to money printing." — Spencer Jacob [03:55]
• "Bitcoin mining is a foundational part of the crypto market because bitcoin is the largest and oldest cryptocurrency." — Vicki Go Hwang [07:57]
• "More of them actually made their money in finance or banking ... There’s people who became billionaires maybe in oil, maybe in roofing, maybe in chocolates." — Inti Pacheco [10:28]

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Timestamps for Important Segments

• [00:35] Global bond yields surge – opening analysis
• [01:28] Spencer Jacob explains investor anxiety in bonds
• [03:30] What would calm markets, and the risk of policy interference
• [04:45] US job openings data and labor market signals
• [06:53] Trump family-backed American Bitcoin debuts on Nasdaq
• [08:44] Policy news: National Guard for crime, Florida's vaccine mandate elimination
• [10:28] US billionaires: origins, demographics, and philanthropy

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Summary prepared by Podcast Summarizer. For a concise review with context and key quotes, see above.

Transcript

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[Alex Osola]

Which u do you listen to? Is it get optioning those options or let's do a little research. Learn [e-mail] TradeSmart Bond yields around the world are rising, a sign that investors are worried.

[Spencer Jacob]

You're really entering a kind of a dangerous territory there because we when central banks lend a helping hand, it has happened before in history to a government to pay the bills. That's tantamount to money printing.

[Alex Osola]

Plus, Florida may become the first state to end vaccine mandates. And here's what we know about America's approximately 1100 billionaires. It's Wednesday, September 3rd. I'm Alex Osola for the Wall Street Journal. This is the PM edition of what's news, the top headlines and business stories that move the world. Global bond yields are on the rise. Yesterday in the UK the yield on 30 year gilts, their equivalent of bonds, hit its Highest level since 1998. Long term yields recently hit multi decade peaks in France and Japan too. In the US the 30 year treasury yield pulled back after briefly topping 5% this morning. For more, I'm joined now by WSJ investing columnist sports Spencer Jacob. Spencer, what is going on? Why is this happening?

[Spencer Jacob]

Well, there's a bout of anxiety about how governments finance themselves and the willingness of investors to extend themselves and take a risk on these longer maturity bonds, which in many countries are 30 years. You're taking the most risk because inflation has the most potential to destroy the value of those bonds. You're also taking a risk because should the unthinkable happen and those countries not be able to repay you or have to resort to some extreme measures to repay you, you're most exposed to danger. And so the people who play in that space generally are not you and I that used to be, but it's pensions, insurance companies that really have very long term liabilities and tend to buy these things and even they are getting nervous.

[Alex Osola]

What is making investors nervous about these countries in particular?

[Spencer Jacob]

Well, what you saw in the UK and you've seen in the last few days is and this is unusual, this is the kind of thing you do see in emerging markets, but not in a developed country like Britain. The currency is sinking in at the same time that bond yields are rising. Generally, people are looking to put money to work around the world and the interest rate rises in a certain country. That makes parking some money there more attractive. When those interest rates rise or the yields on the bonds that you combine, that country rise and the currency sinks, then you know you have a problem, it means that they're going to have to keep lifting that rate, possibly and costing their government a lot of money, because every time that a newer bond is issued, that's more of a strain on the Treasury. And you're seeing that around the world. And just putting the context, what you had happen the last 15 years or so in the world is that interest rates for much of that period in the developed world were very low. Governments spent a lot of money, especially during COVID they had record budget deficits, including in the U.S. and now that interest rates have normalized, a lot of the world, as those old bonds roll over and you have to issue new ones to finance today's deficits, it's getting really expensive. The U.S. for example, pays a trillion dollars a year in interest. A trillion dollars. That's more than the entire defense budget.

[Alex Osola]

Given this situation, what would it take for investors jitters to be calmed?

[Spencer Jacob]

Well, one thing that probably won't happen in the US but could happen in some other countries is if government says, okay, we're going to bite the bullet and engage in some kind of austerity, we're going to raise taxes, we're going to cut spending in the US you have just seen a contentious law passed that cut taxes. Budget deficits are going to be higher than they would have been, and they already were fairly high. That's unlikely to change. Politicians are unlikely to say, oops, sorry, we're actually raising taxes on companies and individuals and especially rich people. What would not calm people would be interference with monetary policy by the executive branch, which hasn't been said explicitly, but is to help those deficits be more financeable. We're really entering a kind of a dangerous territory there because when central banks lend a helping hand, it has happened before in history to a government to pay the bills. That's tantamount to money printing. And that would possibly unleash a lot more inflation than we've seen. And if there's a lot of inflation, then any existing bonds that are outstanding have their value debased and all kinds of other unintended consequences ripple through the economy. That is the real nightmare scenario.

[Alex Osola]

That was WSJ investing columnist Spencer Jacob. Thanks, Spencer.

[Spencer Jacob]

Thank you.

[Alex Osola]

Total open jobs in the US unexpectedly slipped in July to 7.2 million, down from 7.4 million a month earlier. That's according to new data out from the Bureau of Labor Statistics today, which defied consensus expectations that openings would hold steady. Overall, the data paint a picture of a labor market that is slowing but has stalled out A more up to date look at the job market is due Friday morning when the BLS will publish the August Jobs report. In US Markets, tech stocks are back on top. The tech heavy Nasdaq led gains today, adding about 1%, fueled by Alphabet and Apple. Overall, major US indexes ended the day mixed. The S&P 500 added about half a percent while the Dow was little changed. Meanwhile, gold futures rose 1.2% to close at a record $3,593.20 per troy ounce. We're exclusively reporting that Xai's chief financial officer has left the company after only a few months on the job. That's according to people familiar with the matter. It's the latest in a string of high profile departures from Elon Musk's artificial intelligence company in recent weeks. Coming up, how did America's billionaires make their money? We get into the data after the break.

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[Alex Osola]

American Bitcoin, a Bitcoin mining and accumulation business backed by President Trump's two eldest sons began listing its shares today on the Nasdaq Stock Exchange. Shares closed up about 17% at the end of the day. And the latest test of investors appetite for our Trump linked crypto venture. Vicky Ge Huang covers crypto for the Journal and is here now with more. Vicky, what does this business actually do?

[Vicki Go Hwang]

So what it does is it mines bitcoin, which is a complex process where a huge array of specialized computers, they try to solve these complex puzzles in order to unlock new bitcoins. Also, part of American bitcoin's business is to accumulate bitcoin. You buy Bitco and put it on your balance sheet and try not to.

[Alex Osola]

Sell bitcoin, which is famously volatile. But it's not the Trump family's only crypto endeavor. Earlier this week on the show, we talked about another a new digital currency called World Liberty Financial that just launched. Where does American Bitcoin fit in with the Trump family's crypto efforts?

[Vicki Go Hwang]

Well, in just a couple of months, maybe less than a year, the Trump family has reached into every corner of the crypto market. Bitcoin mining is a foundational part of the crypto market because bitcoin is the largest and oldest cryptocurrency. The Trump brothers, their desire, as they've said it, is that they hope that retail investors can access these opportunities.

[Alex Osola]

What benefit does this bring to the company?

[Vicki Go Hwang]

Well, both Eric Trump and Donald Trump Jr hold shares in the company. So by bringing this company to the public market, their stake will be worth a substantial sum.

[Alex Osola]

That was WSJ reporter Vicki Go Hwang. Thank you, Vicki.

[Vicki Go Hwang]

Thank you for having me.

[Alex Osola]

In other news, first Los Angeles, then Washington, D.C. now New Orleans might become the next city to get additional law enforcement from the National Guard, president Trump said today during a White House event in the Oval Office. The president said that Louisiana's Republican Governor Jeff Landry would welcome the federal assistance to combat crime. Posting on X after the event, Landry voiced support for Trump's proposal for boots on the ground in Louisiana, adding that he would accept National Guardsmen across the state and Florida is proposing to eliminate all vaccine mandates, including for school children. That would make it the first US State to end immunization requirements. Florida has a law requiring children to be vaccinated for measles, mumps and rubella and other infectious diseases in order to attend school. The state currently offers medical and religious exemptions to those immunization requirements. Vaccine mandates have eliminated the threat of many infectious diseases, and medical experts say removing vaccine requirements undermines public safety. Florida Governor Ron DeSantis said he will work with the legislature to repeal any laws requiring vaccines, including mandates requiring children to be vaccinated to attend school. As of last year, there were 1,135 billionaires in the US up from 927 in 2020. That's according to data from Altrada, a wealth intelligence firm. Collectively, they're worth about $5.7 trillion. But the data on those billionaires show that they don't all look the way you might expect. Journal data reporter intypcheco recently dug into this and joins me now. Inti I expect an American billionaire to maybe have made their money in tech and live in New York or California. Is that bright image of the American billionaire?

[Inti Pacheco]

It sort of is. There are a lot of them who live in New York or California, and a lot of them made their money in tech, but more of them actually made their money in finance or banking. But there's all kinds of billionaires. There's people who became billionaires maybe in oil, maybe in roofing, maybe in chocolates. They definitely skew older. A lot of them were over 65 years old. A lot of them were in their 80s. Most of them were men. I think it was about 85%.

[Alex Osola]

Were there any surprises that you encountered in this data?

[Inti Pacheco]

Well, one of the things we noticed fairly quickly was the amount of people in our list who inherited a lot of their wealth. A lot of families or dynasties we're calling them, like the Walton family that is tied to Walmart. The Kochs, for example, from Koch Industries, the Pritzkers from the Hyatt, and also the Mars family from the company that made the candy bars. Collectively, each of these families has a group of billionaires. We looked at how much money these families held together, and it was about 15% of the total wealth, about $5.7 trillion in total.

[Alex Osola]

There's some billionaires, such as Bill Gates and Warren Buffett, who have openly pledged to give away much of their wealth. How common is that and where is that money going?

[Inti Pacheco]

A lot of the billionaires have been pledging their money and there's a lot of education, a lot of, like healthcare research, medical research. It's very common for billionaires to give away a lot of their money. But there were hundreds of billionaires on our list that hadn't given any money in the past 10 years, at least publicly.

[Alex Osola]

That was WSJ data reporter Inti Pacheco. Thanks, Inti.

[Inti Pacheco]

Thank you.

[Alex Osola]

And that's what's news for this Wednesday afternoon. Today's show is produced by Charlotte Gartenberg on Rodney Davis. Our supervising producer was Matthew Walls. I'm Alex Osola for the Wall Street Journal. We'll be back with a new show tomorrow morning.

[Spencer Jacob]

Thanks for listening.