US Bonds Post Worst 10-Year Return in 223 Years; Bitcoin Tested by Rising Yields
US government bonds suffered their worst 10-year returns in over two centuries, losing roughly 2% a year. Bitcoin faces pressure as yields rise.
Army Secretary Dan Driscoll resigned after months of tension with Defense Secretary Hegseth, leaving the Army without Senate-confirmed leadership.
The Pentagon's personnel changes normally do not move markets alone, but this departure stands out because it extends an existing pattern. The Army currently has no civilian or uniformed leader confirmed by the Senate; an acting chief of staff has been filling the role since the previous officeholder was dismissed. Defence and geopolitical analysts will monitor whether the friction that prompted Driscoll's resignation signals a wider effort to overhaul senior military leadership. Given that Driscoll was involved in Russia-Ukraine talks, any perceived instability in that diplomatic channel could affect risk appetite and safe-haven flows if it aligns with other geopolitical tensions already present this week.
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Meanwhile, the conflict continues:
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Driscoll's departure means the Army has no Senate confirmed leadership at the top, capping months of disagreement with Hegseth over the service's course.
Summary:
Army Secretary Dan Driscoll submitted his resignation to President Trump, according to the Wall Street Journal, after months of tension with Defense Secretary Pete Hegseth about the Army's direction and the dismissal of many senior Army officers. He is expected to leave the Pentagon within days.
White House spokeswoman Anna Kelly praised Driscoll for what she called "highly effective" leadership in advancing the administration's agenda at the Department of the Army, citing his work restoring focus on readiness and lethality and his involvement in Russia-Ukraine negotiations. Driscoll's exit leaves the Army with no Senate confirmed civilian or military leader. Gen. Christopher LaNeve has been acting chief of staff since Hegseth removed his predecessor, Gen. Randy George, and Driscoll was reported to have had a close relationship with that ousted chief, indicating the tension runs through multiple layers of Army leadership rather than being limited to one relationship.
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Sidebar: what does the Army Secretary do, and why does the role matter
The Secretary of the Army is the top civilian official in charge of the Department of the Army, one of three military departments within the Department of Defense, alongside the Navy and Air Force. The position requires Senate confirmation and is considered cabinet-adjacent, although the Secretary reports to the Secretary of Defense rather than sitting directly in the cabinet. The role carries statutory duties for training, equipping, recruiting, budgeting and overall administration of the Army, working with the uniformed Chief of Staff, who handles military operations and strategic advice, while the civilian Secretary deals with policy, resources and oversight.
In practice, the Secretary serves as the Army's primary link to the political leadership at the Pentagon and the White House, translating broad defense policy into decisions on force structure, procurement priorities and personnel policy for the largest U.S. military branch by uniformed strength. Because the role is Senate confirmed, it also acts as a check within the system of civilian control over the military, ensuring that decisions about one of the country's most significant fighting forces have the legitimacy of Senate consent rather than resting solely on appointees who serve at the President's pleasure without that extra confirmation step.
That is what makes the current vacancy noteworthy. With Driscoll's departure, the Army lacks both a Senate confirmed civilian Secretary and a Senate confirmed uniformed Chief of Staff, since Gen. Christopher LaNeve is serving only in an acting capacity after Gen. Randy George's removal. Having neither position filled through the normal confirmation process at the same time is unusual, leaving day-to-day civilian oversight of the Army resting on acting or delegated authority rather than confirmed leadership, at a time when the service is also reportedly dealing with internal friction over its strategic direction.
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