Bond Traders Hunt For The "Biting Point" As OpenAI's $20 Billion "Apples-To-Oranges" Scare Sends AI CDS To Records

For five weeks the bond market has been screaming at the AI trade, and the AI trade has let it go to voicemail. A 10Y at 5.23%, a Fed governor openly musing about two more hikes, small caps lagging the Nasdaq in 16 of the last 20 sessions: none of it mattered. Then on Thursday the FT reported that a private company books its revenue on a different basis than everyone assumed, and the whole complex puked.

That, in a nutshell, is the state of the most important trade on earth, and it is the subject of two Goldman desk notes that landed within hours of each other this morning. The first is the latest Macro Roadmap from Goldman's Rikin Shah and Cosimo Codacci-Pisanelli, titled simply "Divergence" (available to pro subs), which lays out where the Treasury selloff ends:

The Bond Market Is Paying For The AI Boom