With inflationary concerns weighing upon bonds, how should investors think about the future of yields and their key drivers such as growth, employment, and monetary and fiscal policy? In this conversation with Danielle DiMartino Booth of Quill Intelligence, Lacy Hunt, chief economist at Hoisington Investment Management Co., argues that a growth in money supply does not necessarily create inflation if the velocity of money is low since the extra money supply remains trapped in the financial system. Booth and Hunt consider the acceleration of secular changes such as reliance upon technology, which increases productivity and is therefore a disinflationary pressure. Key learnings: Hunt and Booth argue that the recent rise in U.S. Treasury yields doesn’t take into account vital structural changes such as the decline in the velocity of money and in the marginal revenue product of debt. As such, it is possible that the inflationary fears that have recently rattled the U.S. Treasury market are overblown.