By driving up bond yields, so-called bond vigilantes are challenging U.S. President Barack Obama's use of huge budget deficits to stimulate the economy. "The bond-market vigilantes are up in arms over the outlook for the federal deficit," said Edward Yardeni, who invented the term in 1984. Rising yields on 10-year Treasuries have driven the interest rate on 30-year fixed-rate mortgages to more than 5% for the first time since March 18.

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