It was the kind of line that Robert De Niro would deliver perfectly in a gangster epic. “I am the house now,” the United States Treasury Secretary Scott Bessent declared confidently last week. “And you can bet against me if you want.” It was the most aggressive attempt yet by the most powerful financial official in the world to take on and tame the traders of Wall Street. With major interventions underway to control the yen-dollar exchange rate, and the yields on America’s $40 trillion national debt, Bessent’s message was clear. They will lose money if they dare to defy his will. Well, perhaps they will in the short term. With a background at the world’s most successful hedge fund, Bessent knows more about the market than most people. There is just one snag. He is also setting himself up to fail – and the only real question is when, not if, that happens. 

For anyone who follows American high finance, it has been a dramatic few months. Last year, the Treasury stepped in to support the Argentinian peso, helping out that country’s radical free market President Javier Milei. Over the summer, the Treasury dramatically intervened to prop up the yen, in the first US purchase of the currency in almost three decades. Last month, amid turmoil in the bond markets that sent 30-year yields up to levels not seen since before the 2008 financial crisis, with 10-year yields not far behind, the Treasury intervened again, buying bonds to try and support prices and cap yields. On Thursday, the Treasury bought back $5.2 billion of 10- to 20-year debt, but yields rose regardless; the 30-year........

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