Yield Arbitrage

"So, arbitrage...talk about adrenaline, huh?"
--Tess McGill (Working Girl)

Jaw dropping move in long bonds this am. 10 yr yields down over 8%(!) as money pours into US Treasuries.

You pick the cause(s). Flight to safety/mounting risk aversion. Front-running more Fed cuts--anticipating perhaps FOMC caving to presidential demands. Yield starved fixed income investors in other parts of the world seeking a positive coupon. Leveraged black boxes jumping on the momentum bandwagon of a trade that's 'working.'

Regardless, yield differential between US and rest of world is quickly being arbitraged away.