Debasement tracker
A monthly read on whether policy is wearing down the dollar, and whether the market is pricing it in.
There’s no single debasement number the way CPI is for inflation. So I watch eight, in two groups, and give each a warning light. It updates once a month.
It’s a different question from my stock market froth reading. Froth asks whether stocks are overpriced. This asks whether the dollar is being worn down. For what that means for your own money, and what to do about it, read Inflation is a tax. Debasement is a transfer., or check your own numbers with the personal inflation calculator.
Where it stands
October 2026: nothing is red. The Fed’s rate is about 0.9 points above inflation: positive, but thin. Money supply is growing a little slower than the economy, and the Fed’s balance sheet has been flat since summer. Inflation expectations have sat around 2.3% all year while the 10-year yield climbed past 5%, so Treasury’s effort to hold long rates down isn’t working. The two yellows are gold rising alongside real rates, and the 20-year auction, which was weak in July and again in September.
The machinery: is policy debasing the dollar?
The things the government and the Fed actually control: real interest rates, how fast money is created, and whether the Fed is buying bonds.
Latest: Oct 2026 (through 10/09). Updated 2026-10-12. Changes are over 3 months.
| Month | Real Fed rate | Money vs. economy | Fed balance sheet | Core PCE & the Fed |
|---|---|---|---|---|
| Oct 2026to date | Watch: +0.88%Fed 3.88% − core PCE 3.0% (Aug) | OK: −0.7 ptsM2 +5.7% (Aug) · GDP +6.3% (Q2) | OK: $6.75T+0.1% in 3 mo | OK: 3.0% (Aug)Hiked Sep · 3.75–4.00 |
| Sep 2026 | Watch: +0.88%Fed 3.88% − core PCE 3.0% (Aug) | OK: −0.7 ptsM2 +5.7% (Aug) · GDP +6.3% (Q2) | OK: $6.74T+0.1% in 3 mo | OK: 3.0% (Aug)Hiked Sep · 3.75–4.00 |
| Aug 2026 | Watch: +0.63%Fed 3.63% − core PCE 3.0% | OK: −0.7 ptsM2 +5.7% · GDP +6.3% (Q2) | OK: $6.73T+0.4% in 3 mo | OK: 3.0%Fed on hold · 3.50–3.75 |
| Jul 2026 | Watch: +0.63%Fed 3.63% − core PCE 3.0% | OK: −0.9 ptsM2 +5.4% · GDP +6.3% (Q2) | OK: $6.74T+0.6% in 3 mo | OK: 3.0%Fed on hold · 3.50–3.75 |
| Jun 2026 | Watch: +0.63%Fed 3.63% − core PCE 3.0% | OK: −1.0 ptsM2 +5.3% · GDP +6.3% (Q2) | Watch: $6.74T+1.2% in 3 mo | OK: 3.0%Fed on hold · 3.50–3.75 |
| May 2026 | Watch: +0.42%Fed 3.63% − core PCE 3.2% | OK: −0.9 ptsM2 +5.4% · GDP +6.3% (Q2) | Watch: $6.70T+1.4% in 3 mo | Watch: 3.2%Fed on hold · 3.50–3.75 |
| Apr 2026 | Watch: +0.52%Fed 3.63% − core PCE 3.1% | OK: −1.8 ptsM2 +4.5% · GDP +6.3% (Q2) | Watch: $6.70T+1.7% in 3 mo | Watch: 3.1%Fed on hold · 3.50–3.75 |
| Mar 2026 | Watch: +0.52%Fed 3.63% − core PCE 3.1% | OK: −1.3 ptsM2 +4.4% · GDP +5.7% (Q1) | OK: $6.66T+0.2% in 3 mo | Watch: 3.1%Fed on hold · 3.50–3.75 |
| Feb 2026 | Watch: +0.63%Fed 3.63% − core PCE 3.0% | OK: −1.2 ptsM2 +4.6% · GDP +5.7% (Q1) | OK: $6.61T+0.9% in 3 mo | Warning: 3.0%Cut Dec · 3.50–3.75 |
| Jan 2026 | Watch: +0.73%Fed 3.63% − core PCE 2.9% | OK: −1.7 ptsM2 +4.1% · GDP +5.7% (Q1) | OK: $6.59T+0.0% in 3 mo | Warning: 2.9%Cut Dec · 3.50–3.75 |
The market’s verdict: is anyone pricing it in?
What buyers and sellers are doing about it: inflation expectations, gold, the dollar, and whether anyone shows up to buy long-term Treasuries.
Latest: Oct 2026 (through 10/09). Updated 2026-10-12. Changes are over 3 months.
| Month | Inflation expectations | Gold vs real rates | Dollar (DXY) | Long-bond auctions |
|---|---|---|---|---|
| Oct 2026to date | OK: 2.33%exp +0.05 · 10y +0.49 | Watch: $4,216gold +2.7% · real +0.44 | OK: 102.21+2.4% in 3 mo | OK: 0 of 2 weak10Y, 30Y fine |
| Sep 2026 | OK: 2.36%exp +0.12 · 10y +0.85 | Watch: $4,187gold +3.7% · real +0.73 | OK: 101.45+0.3% in 3 mo | Watch: 1 of 3 weak20Y tail 2.0, dealers 17% |
| Aug 2026 | OK: 2.31%exp −0.07 · 10y +0.30 | OK: $4,482gold −2.4% · real +0.37 | OK: 99.43+0.5% in 3 mo | OK: 0 of 3 weak10Y, 30Y, 20Y fine |
| Jul 2026 | OK: 2.28%exp −0.18 · 10y +0.35 | OK: $4,107gold −11.3% · real +0.53 | OK: 99.80+1.8% in 3 mo | Watch: 1 of 3 weak20Y tail 0.5, dealers 15% |
| Jun 2026 | OK: 2.24%exp −0.06 · 10y +0.14 | OK: $4,039gold −13.1% · real +0.20 | OK: 101.19+1.2% in 3 mo | Watch: 1 of 3 weak30Y tail 1.2, dealers 15% |
| May 2026 | OK: 2.38%exp +0.13 · 10y +0.48 | OK: $4,593gold −12.5% · real +0.35 | OK: 98.91+1.3% in 3 mo | OK: 0 of 3 weak10Y, 30Y, 20Y fine |
| Apr 2026 | OK: 2.46%exp +0.10 · 10y +0.14 | OK: $4,630gold −2.4% · real +0.04 | OK: 98.08+1.1% in 3 mo | OK: 0 of 3 weak10Y, 30Y, 20Y fine |
| Mar 2026 | OK: 2.30%exp +0.05 · 10y +0.12 | Watch: $4,648gold +7.1% · real +0.07 | OK: 99.96+1.7% in 3 mo | Watch: 1 of 3 weak10Y tail 0.7, dealers 13% |
| Feb 2026 | OK: 2.25%exp +0.02 · 10y −0.05 | OK: $5,248gold +23.3% · real −0.07 | Watch: 97.61−1.9% in 3 mo | Warning: 2 of 3 weak10Y tail 1.4 · 20Y tail 2.0, dealers 16% |
| Jan 2026 | OK: 2.36%exp +0.06 · 10y +0.15 | Watch: $4,745gold +18.7% · real +0.09 | Watch: 96.99−2.8% in 3 mo | OK: 0 of 3 weak10Y, 30Y, 20Y fine |
How the lights work
- Inflation expectations. 10-year breakeven = 10-year yield minus 10-year real yield. Red if expectations rise 0.15+ points in 3 months while the 10-year yield rises 0.10 or less. Yellow if expectations rise 0.10+ and faster than the 10-year.
- Gold vs real rates. Red if gold is up 5%+ in 3 months while real rates are up 0.10+. Yellow if gold is up 2%+ and real rates aren't falling.
- Dollar (DXY). Red if DXY falls 3%+ in 3 months, yellow at 1.5%+.
- Long-bond auctions. 10, 20 and 30 year. An auction is weak if it tails by 1bp or more, or dealers are left with 12%+ of it. Red for 2+ weak in a month, yellow for 1.
COMEX gold futures, front month, monthly close (Yahoo Finance GC=F). Runs about 0.3–1.5% above spot. ICE U.S. Dollar Index, monthly close (Yahoo Finance DX-Y.NYB). Treasury Fiscal Data auction results. Dealer share = primary dealer accepted ÷ total accepted (includes Fed add-ons, so it reads a bit lower than the usual 'dealer takedown'). Tail = high yield minus when-issued yield, from Newsquawk / investinglive / ZeroHedge coverage.
Sources: Treasury nominal yields, Treasury real yields, gold, DXY, auction results.
Other ways to measure it
Two more angles that don’t move month to month, so they’re not in the tables:
- Gold in other currencies. If gold is rising in dollars but flat in euros and yen, the problem is the dollar, not gold.
- Assets against wages. Home prices and stocks against paychecks. When assets climb far faster than pay, money is being diluted even when CPI looks calm. That’s how the 2010s looked.
Treasury vs. the Fed
Treasury wants lower rates. The Fed owns the printing press and won’t lend it out.
Treasury’s side. In August, Treasury at least doubled its buybacks of long-term bonds, to $4 billion or more per operation, paid for by issuing more short-term bills. The goal is to pull long-term rates down on more than $40 trillion of debt.
The Fed’s side. Three cuts in late 2025 to 3.50–3.75%. Five holds from January to July 2026 while core inflation rose from 2.9% to as high as 3.2%. Then on September 16, a quarter-point hike to 3.75–4.00%, a week after the bigger buybacks started. The vote was 12–0.
Who’s winning so far: the Fed and the market.
The announcement knocked about 9 basis points off the 30-year, and the rally was gone within days. Once the buybacks started and the Fed hiked, long yields kept climbing. The expanded program adds roughly $14 billion of purchases a quarter against $40 trillion of debt, and strategists at Goldman Sachs and Wells Fargo made the obvious point: buybacks don’t change how much the government needs to borrow. Long yields are rising in the UK, Germany and Australia too.
Dates to watch
- October 27–28: the Fed meets. Backing off while inflation is near 3% would be the first real step toward debasement.
- November 4: Treasury’s refunding. A much bigger buyback program would mean the cap is policy, not an experiment.