Uncle Sam's Debt Recycler: How Treasury Secretary Scott Bessent Controls Interest Rates and Earns an 11% Dividend

The article discusses how the US government, led by Treasury Secretary Scott Bessent, is pushing for lower interest rates ahead of the 2026 election. Bessent's strategy of issuing short-term debt and using borrowed funds to buy longer-term debt has capped yields and driven up demand for Treasuries. The PIMCO Corporate & Income Opportunity Fund (PTY), a closed-end fund with a long effective maturity and leverage-adjusted duration of 3.8 years, is an attractive option for investors looking to profit from falling rates. Despite trading at a 9.6% premium to NAV, the fund offers an 11% dividend and is set up to gain from lower interest rates.