While markets continue to shrug off the stagflationary risks tied to potential chokepoint disruptions, the Department of the Treasury of the Empire managed to place $69 billion of 2-year notes. The auction cleared at 3.812%, slightly through expectations, and a notable improvement from the previous month’s sloppy tail—because in today’s market, mediocrity with a marginal upgrade apparently qualifies as success.

The bid-to-cover came in at 2.65—congrats, slightly better than last month and barely above average, all within a decade-long range that refuses to do anything interesting. Internals? Less impressive. Indirect demand slipped, Directs suddenly showed up in size, and dealers—who were stuck holding the bag last month—finally got some relief. In short: the numbers moved, but nothing really changed.

Overall, it was an average auction—unsurprising in a market still clinging to the idea that U.S. Treasuries are “risk-free,” even as currency weaponization and holy wars quietly redefine what risk actually means.

After a mediocre 2Y auction, the Treasury of the Empire followed up with a similarly uninspiring 5Y sale. The $70 billion issue cleared at 3.955%, slightly below last month but still tailing the when-issued level—marking the 11th consecutive tail. An improvement on paper, perhaps, but hardly a sign of strong demand.

The bid-to-cover was subdued at 2.33—slightly above last month but still below the recent average. Internals were more constructive, however, with indirect bidders taking 72.3%—the highest since May 2025—while direct participation declined and dealer allocation fell to just 12.7%, its lowest level since January.

Overall, a “stronger” auction than the 2Y—helped along by a timely surge in foreign demand—yet still a neat illustration of how comfortably the market continues to treat U.S. Treasuries as if nothing has changed, while the forever holy wars of the Empire are pushing the world to its economic altar.

As the Epic F**k Up strolls past day 60, Tsar Vladimir and Iran Ambassador in Chief met under the polite banner of “diplomacy.” Confucius might smile and say: when two men discuss peace while sharpening swords together, one should admire the efficiency, not the sincerity. While the Empire negotiates in circles, Moscow and Tehran align in straight lines—energy, military, strategy, all neatly arranged.

https://www.aljazeera.com/news/2026/4/27/iran-foreign-minister-in-russia-for-putin-talks

The lesson is simple: when alliances become actions and talks become theatre, the ending is no longer being debated… it is merely being performed.

In a move that surprised absolutely no one, the Bank of Japan kept rates unchanged—while helpfully splitting 6–3 to signal that even it isn’t quite convinced anymore. Policy stayed at 0.75%, the yen briefly rallied, then thought better of it, and Governor Kazuo Ueda essentially admitted the obvious: growth is weakening, inflation is rising, and policymaking has become an exercise in choosing which problem to disappoint. Forecasts were trimmed, inflation nudged higher, and markets now price a decent chance of a June hike—because nothing says confidence like hesitating today while hinting you might panic tomorrow.

In a nutshell, the Bank of Japan hit pause on rates, but with a split vote and rising stagflation signals, markets are already bracing for a “we swear it’s under control” hike next.

In a masterclass of “coordinated independence,” while still seeking USD swap lines from the Empire and after deciding to put a Palantir-like system in charge of parts of its government, the United Arab Emirates has announced it will exit OPEC and OPEC+ effective May 1, 2026—because nothing reinforces cartel unity quite like walking out when quotas become inconvenient. A founding member since 1967, the UAE now seeks the noble goal of “flexibility,” which in practical terms means ramping production from 3.4 to 5 million barrels per day by 2027 without having to ask anyone’s permission—assuming it can export freely when the time comes.

https://www.thenationalnews.com/business/2026/04/28/uae-announces-it-will-leave-opec/

The timing, of course, is impeccable: amid supply disruptions and geopolitical tensions, the world’s seventh-largest producer has decided that collective discipline is best practiced by others. Officials were quick to reassure markets that the UAE will remain a “responsible and reliable producer”—just one that sets its own rules, responds to “market conditions,” and coincidentally maximizes national revenue at a time of elevated volatility.

As the UAE ties its fortunes ever more closely to the Empire, Dubai’s status as an “independent” global financial hub looks increasingly like a branding exercise—because history has always been so kind to those who outsource their strategic autonomy.

While the world politely debates whether energy flows still exist, the Treasury of the Empire carried on regardless, auctioning $44 billion in 7-year notes at 4.175%, slightly below last month—yet still managing to tail the when-issued level. That makes four auctions in a row failing to clear cleanly, because consistency, after all, is what markets value most.

The bid-to-cover improved to 2.51—the highest since last June and comfortably above average—so demand looked respectable at first glance. Scratch the surface, however, and the internals were less convincing: indirect demand softened, direct bidders suddenly showed up in size, and dealers were left with their usual share. In other words, solid headline, slightly less inspiring reality.

Overall, another mediocre auction—reflecting a market slowly coming to terms with the idea that U.S. Treasuries may no longer be the “risk-free” asset they once were, particularly in a world where reserve currency status is increasingly intertwined with geopolitical strategy.

Listen to The Month That It Was in April 2026 from The Macro Butler.

https://themacrobutler.substack.com/p/the-month-that-it-was-april-2026

Having dined with the King of the previously defunct Empire and survived another Taco Tuesday in the service of his nation, the Warmonger-in-Chief has emerged from the shadow of the White House with the steely resolve of a man who has decided that niceness is officially over. No More Mr Nice Guy — a declaration that lands with particular gravity from a leader who has spent six weeks threatening civilisations with hellfire, blockading a blockade, and calling sovereign nations "crazy bastards" on Truth Social.

The Blockade of the Blockade — Don Tzu's finest strategic contribution — continues making physical barrel shortages measurably worse by the day, with Season 2 still in pre-production. The villain, as always in the Bond franchise, believes he controls the situation right up until the moment it becomes apparent that he does not. The Strait remains closed. The barrels remain scarce. And the Beast, one notes, runs on gasoline.