"Huge washouts hit the $29 trillion Treasury market in recent days,
as investors looking to exploit small price differences in the bedrock of financial markets
were overcome by volatility resulting from President Trump’s tariff fight.""It hinges on moves in the swaps market, a cornerstone of global trading activity.
Specifically, it relates to the swaps spread, or difference, between the 30-year
floating Secured Overnight Financing Rate, or “SOFR,” and Treasury yields." "The trade counted on the spread to widen, but that hasn’t been playing out.
Instead, the world got the biggest global trade fight in a century in the form of tariffs,
and extreme volatility in bonds that has forced a sudden washout of some leveraged players."https://www.marketwatch.com/story/how-the-trade-of-the-year-became-a-nightmare-for-investors-after-trumps-tariffs-adead217Edit/Add: Previously, it was widely reported that hedge funds' bets on discrepencies between Treasury prices
and futures contacts (known as the 'basis trade') were unwound which caused widespread selling in Treasuries.
https://www.mutualfundobserver.com/discuss/discussion/comment/190558/#Comment_190558
