Plenty of bond-market bears could claim vindication on Wednesday when the 10-year Treasury yield briefly topped 4% for the first in more than a decade. But denizens of “finance Twitter” were quick to point out that a fictional option trade by one of the main characters from the television series “Industry” would have gone “in the money” (trader parlance meaning the option could be exercised for a profit) thanks to the bond-market milestone.
Fans of the show may remember that character Harper Stern, a young Black woman fighting for a job at the fictional investment bank Pierpoint & Co., convinced a client during a dinner in the show’s inaugural episode to purchase an option contract on a $500 million slug of 10-year Treasury notes that would have paid off if the yield topped 4%. Although her colleagues scoffed at her original pitch, Stern argued that Treasury bonds were due for a “massive selloff” as foreign buyers of U.S. debt — particularly China due to tensions in the South China Sea — backed away from the market in response to the fictional U.S. administration’s aggressive behavior.
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