Where Warren Buffett Goes, Wall Street Follows: The $25B Bill Binge
Surbhi Jain 1 year ago
Bonds
Trump's policies and fiscal hawkishness are causing Treasury yields to rise, making short-term bonds more attractive for investors seeking stability and yield.
Treasury yields are climbing again, but this time it’s not just about inflation or the Fed. It’s about politics, policy, and a little something called “bond vigilance.”
As President Donald Trump's team flexes its fiscal muscle, pushing tax legislation and emphasizing long-term debt discipline, Wall Street is reading the tea leaves. It’s sprinting to the front of the yield curve. The BNP Paribas forecast of a 4.25% 10-year yield by the end of 2025 isn't helping investor nerves.
But for many, the strategy is simple: don't fight the yield, just keep it short.
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The $25 Billion Bill Binge
In 2025 alone, investors have poured over $25 billion into ultra-short bond ETFs like the iShares 0-3 Month Treasury Bond ETF (NYSE:SGOV). Inflows into ultra-short bond ETFs were second only to the S&P 500 ETF in new inflows this year, reported CNBC. The SPDR Bloomberg 1-3 Month T-Bill ETF (NYSE:BIL) and the Vanguard Short-Term Bond Index Fund ETF (NYSE:BSV) aren't far behind.
Why the rush into these seemingly sleepy securities? Because they’re quietly delivering—and investors have noticed.
The 3-month T-Bill now yields over 4.3% – higher than the 2-year and nearly matching the 10-year, without the duration risk. In a year dominated by uncertainty over the Fed's path, policy whiplash, and geopolitical noise – stability and predictability are the real alpha.
Warren Buffett Owns 5% Of The Market
"Long duration just doesn't work right now," says Strategas Securities' Todd Sohn. Warren Buffett seems to agree—his Berkshire Hathaway Inc (NYSE:BRK) (NYSE:BRK) now owns a stunning 5% of the entire short-term T-bill market.
And behind the scenes, Trump's advisors are reportedly focused on keeping long-term rates in check. Treasury Secretary Scott Bessent has signaled a pivot toward more short-term debt issuance and regulatory tweaks to ease pressure on yields.
BNP Paribas strategist Tim High calls it "bond vigilance," a sort of fiscal hawkishness that aims to calm the bond market without relying on the Fed.
But for the market, that vigilance is turning into a signal. The long end may be politically volatile, but the front end is flush with yield – and less drama. Investors chasing safety, yield, and clarity have found a perfect storm in 0-3 month paper.
Call it the year of the ultra-short bond: it's catching Buffett's eye, staying on Trump's radar, and winning over Wall Street.
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Photo: Jonathan Weiss/Shutterstock