The upheaval in stocks has been grabbing all the headlines, but there is a bigger problem looming in another corner of the financial markets that rarely gets headlines: Investors are dumping U.S. government bonds.
Normally, investors rush into Treasurys at a whiff of economic chaos but now they are selling them as not even the lure of higher interest payments on the bonds is getting them to buy. The freak development has experts worried that big banks, funds and traders are losing faith in America as a stable, predictable, good place to store their money.
Destroying the world's faith in the dollar is a cherished goal of both Putin and Xi. They couldn't do it, but the Felonious Syphilitic Sociopath-in-Chief is doing it, single-handedly.
He may ultimately destroy the dollar as a global reserve currency. Which will mean that when we buy imported goods, we will be paying for them in euros. Which are becoming more expensive.
The FLOSS is damaging the global economic foundations of the U.S. in ways that may never be repaired.
3 comments:
The Spanish inquisition?
Donald Trump meets an opponent he can’t face down: the bond market
https://www.thetimes.com/us/business/article/donald-trump-tariffs-bond-market-borrowing-bzgwt87cc?utm_medium=Social&utm_source=Reddit®ion=global
GLD is at an all-time high https://finance.yahoo.com/quote/GLD/
Who owns the most gold and how big is the crater going to be?
Method or Madness? Trump’s team calls it strategy—leverage to force trade deals, boost U.S. factories, and fund tax cuts ($600 billion yearly, Navarro claims, The Guardian, April 2). The April 10 pause on some tariffs (90 days, except China’s 125% hike) suggests they’re feeling the heat—bond markets got “yippy,” Trump admitted (Democracy Now, April 10). Critics like Joseph Stiglitz see no logic—just a “schoolyard bully” torching decades of trade norms (Democracy Now, April 10). The flip-flops—autos delayed March 5, Canada/Mexico paused April 6 (NPR, March 7)—scream improvisation, not genius. Yet, there’s a method if you squint: chaos forces action. China’s talking (April 7), and EU’s prepping deals. But the cost—recession odds up to 40% (JPMorgan, Al Jazeera, March 11)—might bury any wins.
Chaos as Opportunity? Some thrive in the fog—Brazil’s soy farmers are grabbing China’s market; gold’s at $2,895/oz, up 10% this year (Al Jazeera, March 11). Speculators shorting shipping stocks (SBLK, GOGL) bet on Baltic Dry Index drops as trade slows—X buzzes with puts talk (April 9). But for most, it’s paralysis—nobody invests when tariffs might vanish tomorrow or double next week.
This chaos is a global stress test—supply chains, markets, alliances all cracking. Farmers and consumers are collateral damage; manufacturers are frozen. Is there a grand plan? Maybe, but it’s drowning in execution flops. Where do you want to aim next—farmers’ next move, supply chain fixes, or something else in this storm?
Grok can answer questions for you https://x.ai/
He may ultimately destroy the dollar as a global reserve currency. Which will mean that when we buy imported goods, we will be paying for them in euros. Which are becoming more expensive.
It's worse than that.
You buy things in int'l trade with magic tokens. You must have something to sell in order to get them to buy the things you want. If you are the country who makes the magic tokens (America), you almost get the things you want for free (when compared to other countries).
Then there's the worse part. Should it happen that the world moves towards a different magic token, the old magic token not only becomes valueless (as a magic token), but then there are all these old, now comparatively valueless , no-longer-magic tokens floating around that people in intl trade no longer can use as magic tokens. So they want something of value for that old is-no-longer-magic token!! And they show up for a refund...for trillions of them, saying these are no good.
He also screwing up the trade deficit. That the thing that happens
when products are sold and money is paid. The so called deficit is
we are buying more then selling to them, we are paying and if they
buy they pay. The error in belief is if they are not buying as much
as us its bad.
Its sorta the same thing as imaginary numbers. And the seller pays tariffs.
At times it seems a scorched earth policy without fire.
Eck!
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