"Bond King Gundlach predicts yields are headed much higher before this move ends"

Note the issuance number,* that is important. The jawboning between the President and Chairman Powell, not so much.

From CNB, October 12:

There's another big reason why Trump could blame the Federal Reserve for rising interest rates

• President Trump has criticized the Fed for raising interest rates in a period of low inflation, but it's another Fed policy move that is helping drive interest rates higher.
• The Fed is unwinding its balance sheet, which ballooned during the financial crisis, and in the process is buying less Treasury securities, just as the federal government is issuing much more debt.
• The fact the Fed has stepped back as a buyer, combined with the increased debt issuance, has been a topic of discussion in the bond market as interest rates were on the rise this month.

President Donald Trump has been unabashedly vocal in his criticism of the Fed's interest rate hikes, but the president has been quiet on another important Fed policy that may also be a big factor behind the rise in longer-term rates that influence all sorts of loans, including home mortgages.

On the surface, the Fed's slow and steady approach to raising short-term interest rates once a quarter is less aggressive than it's been in past cycles. But it's the the Fed's parallel balance sheet moves that have gone under the radar, except in the bond market where it is closely monitored.

That's because the Fed has stepped back as a buyer in the Treasury market, at a time when the Federal government is also issuing a mountain of new debt. Since last year, the Fed has been gradually reducing the purchases it makes to replace Treasury and mortgage securities on its balance sheet as they mature.

"Investors are starting to realize just how many bonds are coming at us in the year and two ahead. And I've talked about this repeatedly over the last couple of years. We had a budget deficit in the United States that went up from around $600 billion a couple of years ago to now the official number for fiscal '18 in now over $900 billion. But that doesn't really capture how much debt is really being added to the national debt in the United States," said Jeff Gundlach, DoubleLine CEO on CNBC.

Gundlach said there is also a loan to the Social Security system that takes the figure to $1.27 trillion. There are also pension liabilities and veterans benefits.

"On top of that you have the Fed now cranking up quantitative easing [sic. he meant tightening] to $50 billion a month, which is another $600 billion for fiscal 2019 if they continue on that course. Which takes you to around $2.25 trillion of debt increase. And this is at a time where we're supposedly in a good economy," he said. The Fed's $50 billion a month reduction includes both Treasurys and mortgages....

...MORE

As self-referenced in October 3's "Bonds: It's The Long End That Gets You":
We'll probably  be droning on about 10 and 30 year action for a few more months.*

*As we mentioned a couple months ago, the Fed mucking about at the shorter end isn't where you want to focus, rather it will be the dramatic increase in Treasury issuance, and participants reaction to same that will determine the course of events.

From a September 21 post, acknowledging we didn't nail everything but caught enough to be on the right side of the equity up-move:

"Mortgage Rates Head to 6%, 10-Year Yield to 4%, Yield Curve Fails to “Invert,” and Fed Keeps Hiking"

Not exactly the scenario we were looking for back in July but close on a couple particulars, more after the jump....

Our July post was "Signals From the Yield Curve: It's the Long End That Gets You" :

This forecast is so close to our thinking that I did a double-take when I first saw it.
The only thing I can add is to point out that these are dynamic systems, that any changes to the trajectory have implications for where we end up so this scenario is not preordained.
But that's the way to bet. At the moment.

It's possible that the tariff-and-currency war of 2018 slows things down enough that the Fed pauses, stops bumping up the short end or that Treasury issuance is large enough to drive the long end higher but for right now, this is where we're at....

The combo of a rising long end combined with a slowdown due to tariff concerns has proven accurate only for the first half of the combo. We reiterated it in August's "10Y Treasury Yield Tops 3.00% After Surprise Supply Increase":

As foretold by the prophesy:

"..It's possible that the tariff-and-currency war of 2018 slows things down enough that the Fed pauses, stops bumping up the short end or that Treasury issuance is large enough to drive the long end higher but for right now, this is where we're at..."

—Signals From the Yield Curve: It's the Long End That Gets You, July 22

I know we've gotten a bit obsessive with the whole "the yield curve does not matter" but it is important. The recession chatter is early, if not flat wrong.
We'll have some ideas if and when the curve matters for equities and the economy but right now there are more pressing concerns.