What if the Fed Raises Rates and the Long End of the Bond Market Falls?

In a fascinating report Paul Mylchreest of Admisi asks a pertinent question. What if rates decline on the long end of the bond curve when the Fed raises the short rates? 

Admisi

The above chart shows the negative correlation between the Repo Rate (rate charged on Open Market Operations - the mechanism the Fed uses to alter short term rates) and the 10 year Treasury Yield.

If this negative correlation continues to hold, the Fed could invert the curve, and push real rates further negative and benefit different economic sectors than originally assumed (weak dollar, strong commodities, strong bond prices, weak stocks).