But the reception was indicative that fears have been held mostly in check over whether investors eventually will tire of the constant conveyor belt of government debt.
"It doesn't look like there's a big problem. The markets aren't showing a lot of worry," said Kim Rupert, managing director of global fixed income analysis at Action Economics in San Francisco. "They might not be stellar but I don't think these are going to be the auctions that fail."
The notion that Fed policy will remain accommodative to growth and undaunted by inflation prospects only gained ground after Friday's unemployment report showed the economy shed an unexpectedly high 85,000 jobs in December.
Larson had warned of a bond bubble well before last year's awful Treasury returns. But he also said the day likely hasn't come yet when investors launch a wholesale strike against long-dated debt.
While today's $10 billion auction of Treasury Inflation Protected Securities went well, results are less certain for the three-, 10- and 30-year sales to come as the week progresses, Larson said.
TIPS gained about 10 percent in 2009 while Treasurys fell 3.5 percent.
"People are looking for protection from inflation in this market and it's easy to see why," he said. "The jobs report wasn't awful enough to put the double-dip (recession scenario) back on the table, but it wasn't good enough to prompt some action from the Fed."
Nevertheless, he sees yields eventually having to rise to reward investors willing to take on long-term bonds, which are most sensitive to inflation.