"Regardless of which you believe, it is bad news," he wrote.

"The recent move in long rates is a warning to the incoming Trump Administration. It needs to have a view of how its plans for tax legislation, deficit reduction (or not), and cross-border economic policy will affect this recent development."

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"Pivotal in that fight was the bond market, which deficit hawks warned would drive interest rates higher unless Washington showed progress in reducing the budget deficit.

James Carville, Clinton's campaign guru, was reported to have bitterly remarked that if reincarnation existed, he no longer wanted to return as a president or a pope or a .400 batting-average baseball player.

"Now I want to come back as the bond market," Carville said of the the power Wall Street had exerted over the administration's policymaking. "You can intimidate everybody."

Another reason for bond markets to be nervous is that Congress will need to again raise or suspend the country's debt limit this year to avoid defaulting on the U.S. debt, which would immediately crash the economy."