US Treasuries are caught in the cross currents of the K-shaped economy. We would loosely define this as a divergence between different segments of the economy. In today’s context, this would be the optimism seen in the AI/tech related sectors that could see increasing amounts of real investment versus the other sectors, which are more pessimistic. This can be viewed through three lenses – the divergence between stocks and UST yields, the divergence between stocks & job creation and the divergence between stocks and Trump’s approval rating.
The main worry for investors is that the US economy (and the stock market) may have become too reliant on tech. Even as the stock market does well, it is not translating into jobs creation. While market participants may be anticipating a decent September NFP print, this data set is dated and more recent alternative data are pointing to a further slowdown in October. This could account for why Trump’s approval rating has been declining despite the bullish sentiment on stocks and relatively muted inflation from tariffs thus far. Keeping mid-term elections in mind, Trump may have to resort to fiscal stimulus (cash handouts) to try and bolster support. UST yields are caught between drifting higher on the back of buoyant stocks or heading lower on job market caution.
The K-shaped economy may have to converge at some point. It is difficult to envision a sustained period of jobless growth. At some point, there should either be a broadening out in optimism to the other sectors or job losses would start to weigh more broadly. Accordingly, the divergence between a more cautious bond market and an optimistic stock market has got to end (either yields higher, stocks lower or a combination of both). 
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