The US Treasury is weighing whether to tap its General Account — which held close to $950 billion as of this week — to help fund an expanded program of long-term bond buybacks, according to two senior Treasury officials cited by CNBC. The General Account functions as the federal government's primary operating account at the Federal Reserve, and Treasury Secretary Scott Bessent has kept its balance well above the $550-600 billion level the prior administration typically maintained.
The move would mark a shift from the prevailing market assumption that buyback purchases — a mechanism Bessent has previously described as a “Treasury Twist” — would be funded entirely through new short-term bill issuance. Officials didn't rule out that approach either; the General Account is being framed as an additional funding source, not a replacement for it.
An Escalating Buyback Program
The Kobeissi Letter tracked the program's escalation: the Treasury first doubled its long-term debt buybacks from $2 billion to a $4 billion minimum earlier this week, then Bessent said on CNBC the operations could run even larger than that new floor, and now officials are discussing drawing on the General Account itself to help finance the larger purchases. The 10-year Treasury yield has continued to ease as the buyback program has scaled up.
Why Officials Aren't Worried About a Cash Crunch
A partial drawdown of the General Account isn't seen internally as creating a near-term cash management problem, officials said, since the next debt-ceiling constraint isn't expected to bind until sometime between winter and early spring. That timing gives the Treasury room to spend down part of its cash buffer now without immediately running into a legal borrowing limit.
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The Bigger Picture for Markets
Bessent's buyback push comes amid broader turmoil in Treasury yields that has drawn attention well beyond bond markets — including, notably, a rally in Bitcoin that some traders have directly tied to expectations of expanded government liquidity support. Whether the Treasury ultimately draws on the General Account, leans harder on bill issuance, or blends both will likely shape how much further the buyback program can scale before the debt ceiling becomes a binding constraint again.
