Fed’s Musalem: Nominal Yields Rising Partly on Higher Real Rates

Musalem's framing matters because it attributes the move in nominal yields to rate expectations rather than inflation compensation or a term-premium shock, which shifts the debate toward how much tightening is already embedded in the curve. For rate-sensitive corners of crypto and tokenized real-world assets, the relevant channel is the discount rate on future cash flows, not the inflation narrative. Whether real yields keep driving nominal yields, or the term premium reasserts itself, is the open question worth tracking.