LONDON, April 10 (Reuters) - U.S. President Donald Trump's decision to pause the hefty duties he had said he would impose on dozens of countries one week ago followed turmoil in financial markets that included an acute selloff in the $29 trillion Treasury market.

Trump said on Wednesday the bond market had recovered well after investors became queasy about it in reaction to his tariff announcements.

"The bond market now is beautiful," he told reporters.

The selloff is the latest sign of the power of government bond markets to act as a restraint on policymakers, while talk of a return of so-called bond vigilantes has risen in recent years.

WHAT HAPPENED IN BOND MARKETS THIS WEEK?

In short, the U.S. Treasury market -- a central pillar of the global financial system -- came under heavy selling pressure, sending 10-year borrowing costs surging.

At one-point, 10-year bond yields were set for their biggest weekly jump in more than a decade. Bond yields move inversely to the price. Trading at 4.27% on Thursday, those yields are comfortably below Wednesday's peak of 4.51% . They are also well below the high of almost 5% hit in late 2023 and the double-digit levels seen in the 1980s.

Notably, this jump was a sharp reversal of the initial fall seen after Trump's sweeping tariff announcement last week that raised U.S. recession risks and expectations for rate cuts.

More at:


https://archive.ph/aFwkA

meltdown. Not widely reported how much risk there is out there. Derivatives are back. Recession looming. World considering switching official currency from US dollars to something else. Treasury sell off risk.

On the one hand, TSF probably doesn't want blame (though he can delude himself into alternative facts)...on the other financial chaos shock can lead to greater inequality and a rise in fascism, historically.

I know some experts -- well, English majors, at least -- have analyzed Turnip's speech patterns and concluded he speaks and writes at about a fifth-grade level (apparently fifth graders have declined since my childhood). Has anyone done an analysis of his vocabulary, to show how much he relies on the same words and phrases over and over and has command of only a very small subset of the English language ? What's the estimated size of his vocabulary ? If anyone ever does a word cloud of his collected speeches (*as given*, not after cleanup, aka "Millerizing&quot I bet it would be the tightest, most closely grouped word cloud ever.

Many countries own some treasuries. Each country could offload some without damaging their own economy, but collectively could flood the market. Nice play, Carney

Treasury bonds.
Thanks for posting this article that tells the background story.

Done.
Kicked for visibility

Carney is great!

puts the kibosh on Trump.

I believe there were at least 3 objectives with this move:

1) Remind people in the Beltway that the US has been accumulating massive debt. That means other countries have been funding our lifestyle. And this shows that they are willing to band together.

2) Hit corporate execs hard with the threat of their borrowing costs going way up, after a decade of practically free money.

3) Show Trump that other countries have the power to explode the cost of the US government. With today's cheap money, we pay almost a trillion dollars a year in interest, which is about 13% of our budget, roughly the same as the entire defense budget. The foreign debt-holders could conceivably push this to twice its current size, which would be calamitous.

Trump didn't come to any realizations. He simply got beat up by Jamie Dimon, Musk and others who understand how this could blow up in our faces.

The big question is China. China is the second-largest holder of US debt (second to Japan). Canada and friends decide to include CHina in their club, this would be huge amount of economic leverage over the US.

Bottom line, this is what 45 years of Reaganomics has done to us. When Reagan took office, foreign countries held about $30 billion of our debt -- an insignificant amount. In today's dollars, that's a little over $100 billion. That's not enough to worry about. Thanks to the miracle of Reaganomics, today the amount of US debt held by foreign countries is about $8 trillion.

760 billion worth of treasury's

https://ticdata.treasury.gov/resource-center/data-chart-center/tic/Documents/slt_table5.html

That big chunk from the Cayman Islands is probably mostly Russian.

I doubt Canada would get the UK to go along. but if Canada, Japan, Belgium, France, Singapore, Brazil, and Norway acted as a bloc, this would be enormous leverage.

And the really big risk is that they all decide they are better off teaming with China than Trumpistan, they can crash our entire economic system. Along those same lines, if China is seen as a more reliable trading partner, they could basically fence the US off from the rest of the world economies.

It can't really go that far because countries like Germany, Japan, and Korea have big investments on the ground in the US. Trump's next step would be to nationalize all those factories, a la Fidel Castro.

No matter which way this goes, it is a huge financial mess, and completely unnecessary. One wonders if there comes a point where the multinational corporations decide that Trump has to be eliminated.

Nicely played, PM Carney!
Thank you for posting this,

has abused, we don't 'have all the cards' that he thinks we have.

Biden united NATO countries and others against Russia...TSF is uniting the rest of the world against us.

One Canadian press corp has asked Carney about this. Carney was not even PM until mid March, so he would not be responsible for buying US bonds. Is he smart enough, yes but this is pure speculation and not well thought out.

Carney also worked as one of many informal advisors to Canadian prime minister Justin Trudeau during the COVID-19 pandemic and was made chair of the Liberal Party's economic growth taskforce in September 2024.

He was an advisor and Canada did sell, along with other countries, their US bonds but I have not seen or heard anything that backs up this guys assertions that this was all to do with Carney. I voted for Carney for leadership and will vote for him in the general election but other than seeing this yesterday on a Substack, there is no other reporting on it.

Would want to be easily caught with their hand in the cookie jar so to speak.

But I think collectively speaking countries that buy our debt should be having second thoughts about now. Trump and the Republicans are on the verge of generation another massive budget deficit that will need to be funded. That coupled with a lot of debt needing refinanced this year is probably a bit unnerving especially that a Recession is on the horizon.

I don’t believe a few players can overly influence the bond market and they certainly wouldn’t want to be caught red handed. But given the current economic uncertainty and the amount of current and anticipated US debt, why is anyone surprised by how the bond market is behaving?

definitely not krasnov and trudeau and carney
aren't stupid-
o canada!!!

Trudeau or Carney, other than circumstances that made many dump their bonds.

... and saying that a trade deficit means other countries are ripping us off. How can anyone involved in any way with finance not be terrified that such an ignorant person is deliberately causing such chaos and damage?

got dealt.

Last edited Fri Apr 11, 2025, 01:22 AM - Edit history (1)

and volatile. A good graph of that volatility, e.g. Vanguard IntermediateTerm Treasury Admiral VFIUX
https://www.morningstar.com/funds/xnas/vfiux/performance

plus a table of total annual returns by year. Negative numbers are in parenthesis ( )
2015 1.61%
2016 1.29%
2017 1.67%
2018 1.10%
2019 6.39%
2020 8.31%
2021 (2.19%)
2022 (10.34%)
2023 4.18%
2024 1.48%
YTD 2.78%

which shows some of the volatility and the piss-poor returns.
Since the beginning of 2015, its total return is cumulatively only 11.61%
(A $10,000 investment grew only to $11,161 in those 10.25 years)
which comes to an average annualized total return of only (1.1161^(1/10.25) -1)*100% = 1.077%/yr

And as far as purchasing power, it is way underwater:
CPI: https://data.bls.gov/timeseries/CUSR0000SA0
1/2015: 234.747
3/2025: 319.615
So, consumer costs rose 36.15% during that period.
The purchasing power of the $10,000 bond portfolio is now only $8,197 (=234.747/319.615 * $11,161), an 18.03% decrease.

is misinformation, I am sending this article to you so you can set the record straight. I would love it if our PM and country were as powerful as this deanblundell thinks we are, but it is not the case and we should keep things real.

Here is an article that counters his substack

https://axorc.substack.com/p/no-mark-carney-didnt-sell-off-us