While the jury seems to still be out on a similar question I posed earlier: Why did Greenspan think rate hikes would increase treasury term premiums?, I have recently begun entertaining an entirely different explanation for the decoupling of treasury term premiums and Fed rate hikes: the growth of eurodollars. With no central governing body, it seems exact market sizing is not possible/maintained or published. The most recent cited sizing in the wiki was for 2016, with a readout of: USD13.8tr -- a truly colossal figure for the time.
Eurodollars have been around for awhile, of course, are are one of the most prominent fixtures in global finance. But it never occurred to me until recently that eurodollars could explain why yields could stay low despite what the Fed did with its rates. To me, having such a huge supply of US dollars outside the purview of the Fed would mean that corporates and the buy-side in general don't have to price in drastic adjustments because the Fed is tinkering with its policy instruments: there's a giant pool of virtually the same stuff right across the pond (and the Pacific).
Might not "Greenspan's conundrum" be more persuasively explained by the shear size of the eurodollar market? Why/ why not?