Bond vigilantes are ‘saddling up.’ Here’s how concerned investors might take action over the ballooning federal deficit.

• Bond vigilantes are “saddling up” again as federal deficits balloon, said market veteran Ed Yardeni.
• He coined the vigilantes term, referring to investors who sought smaller deficits by sending yields higher.
• “[W]e’ve got the federal deficit widening when the economy is doing well. And I think the bond vigilantes are quite concerned about that.”

Bond vigilantes are getting ready to throw their weight around the Treasury market as the federal government’s budget deficit is set to balloon, according to market veteran Ed Yardeni.

The president of Yardeni Research is famous for coining the vigilantes term in the 1980s, referring to traders who protested massive deficits by selling off bonds to push yields higher.