I don't normally pay much attention to Treasury Bond auctions,

but they've recently become a focal point for markets.

Some even think that weakness in recent auctions is sending a troubling signal about US government

debt.

So what's behind those concerns and do they have merit?

Where's the demand coming from to satisfy all of this supply and how much does the yield curve need to

reprise in order to effectively accommodate the issuance needs of Treasury.

I'm Allison Nathan and this is Goldman Sachs exchanges.

Today I'm sitting down with Johnny Fine, who heads up our investment-grade business in our

investment banking business, and Alec Phillips, our chief U.S. political economist in Goldman Sachs

research.

Johnny, Alec, welcome.

Thank you for having us.

Thank you.

Johnny, let's start at a really basic level here.

For those of us like me that don't live and breathe Treasury auctions,

help us understand how they work.

Well, first of all, I can't believe you don't live and breathe them every single day.

I mean, it's the most fun thing that we could spend time talking about.

But let me try and break it down for you.

Well, look, firstly, the Treasury auctions are a lot of securities in any one given year.

Some of them weekly, some of the monthly, some of them quarterly, there's a lot of them.

...