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Trump's tariffs shutting down US businesses laying off workers.

superpower said:
Let Ray Dalio explain to you the bond crisis:

https://substack.com/@marketsentiment/note/c-119362970?utm_source=notes-share-action
Click to expand...

The bond market is experiencing significant volatility, but calling it a "crisis" may be an overstatement, and the term can be weaponized to criticize the Trump administration. Let’s break it down based on available information up to May 24, 2025.
Evidence of Bond Market Volatility:
  • Recent Events: In April 2025, U.S. Treasury yields surged, with the 10-year Treasury note yield jumping from below 4% to around 4.5% in a week, and the 30-year yield hitting 4.92%, the largest three-day spike since 1982. This was driven by a sell-off in U.S. Treasuries following Trump’s "Liberation Day" tariff announcements on April 2, 2025, which sparked fears of inflation and economic disruption.



  • Market Reaction: Investors sold off Treasuries, typically seen as a safe haven, alongside stocks, which is unusual and signals a loss of confidence in U.S. assets. This was attributed to uncertainty over Trump’s tariff policies, rising inflation expectations, and concerns about the U.S. government’s ability to manage its $36.22 trillion debt. Yields rising while bond prices fell indicated investors demanded higher returns for perceived risk.




  • Current State: As of May 2025, yields remain elevated, with 30-year Treasury yields reaching 5.1% recently, close to a two-decade high. Posts on X and reports suggest ongoing pressure due to structural debt issues and fiscal policy concerns, though yields have stabilized somewhat after Trump’s 90-day tariff pause on most countries except China.
Is It a Crisis?
  • Arguments for a Crisis:
    • The rapid yield spike and simultaneous stock and bond sell-off raised alarms, with some analysts comparing it to the 2008 financial crisis or the 2022 UK bond market turmoil under Liz Truss.



      nJDmubGJ_normal.jpg
    • Prominent voices like former Treasury Secretary Lawrence Summers warned of a “serious financial crisis” induced by tariff policies, and financial historian Adam Tooze suggested a potential “full-blown bond market meltdown.”

    • The sell-off by foreign investors, who hold about 33% of U.S. Treasuries, and fears of major holders like China or Japan dumping bonds as retaliation, fueled concerns about a broader loss of faith in U.S. debt.


    • Rising yields increase borrowing costs for the government, businesses, and consumers, risking a spiral where higher interest rates exacerbate the $1.8 trillion budget deficit and could lead to defaults or economic contraction.
  • Arguments Against a Crisis:
    • The bond market stabilized somewhat after Trump’s April 9, 2025, announcement of a 90-day tariff pause, with a $39 billion Treasury auction proceeding without incident, suggesting no immediate systemic collapse.


    • Treasury Secretary Scott Bessent downplayed the sell-off as a “normal deleveraging” and not systemic, and some analysts noted that trading remained orderly despite volatility.


    • The April inflation numbers showed prices didn’t spike significantly post-tariffs, easing immediate fears of runaway inflation driving the bond sell-off.

    • Historical context: Bond market volatility isn’t new, and similar yield spikes occurred in 2020 and 2008 without leading to a sustained crisis. The Federal Reserve could intervene with liquidity if needed, as it did in past disruptions.
Is "Crisis" a Political Jab?
  • The term “crisis” is often amplified in media and by critics to highlight policy missteps, especially given Trump’s tariff-driven agenda. Outlets like The Guardian, CNN, and The Atlantic have framed the bond market turmoil as a direct consequence of Trump’s erratic trade policies, with headlines emphasizing his “about-face” or “chickening out” under market pressure.



  • Posts on X, like those from
    @Peston
    and
    @Mayhem4Markets
    , explicitly tie the bond market’s reaction to a “no confidence vote” in Trump’s policies, suggesting a narrative targeting his administration’s credibility.

  • However, the administration’s defenders, like Bessent, argue the market overreacted and that the tariff pause was part of a planned strategy, not a capitulation. They claim the economic benefits of tariffs and tax cuts will outweigh short-term market jitters.


  • The use of “crisis” can reflect ideological bias, as it’s a loaded term that grabs attention. Critics of Trump may overstate the severity to underscore policy failures, while supporters might dismiss it as market noise or temporary deleveraging. The truth likely lies in between: significant disruption but not yet a systemic collapse.
Critical Perspective:The bond market is signaling real concerns—rising yields reflect investor unease about inflation, debt sustainability, and Trump’s unpredictable policies. However, labeling it a “crisis” risks exaggeration unless defaults or systemic failures materialize, which hasn’t happened yet. The Fed’s ability to step in and the tariff pause’s calming effect suggest containment is possible. Still, the market’s reaction shows it’s a powerful check on policy, as seen when Trump blinked after yields spiked. The narrative of a “crisis” is partly driven by political opponents to pressure the administration, but the underlying issues—debt, tariffs, and investor confidence—are substantive and not merely rhetorical.


Conclusion:There’s no full-blown bond market crisis as of May 24, 2025, but the market is under strain due to Trump’s tariff policies and fiscal concerns. The term “crisis” is used both to describe genuine market turbulence and as a political tool to critique the administration. Ongoing uncertainty about tariffs, deficits, and global trade could keep yields volatile, but systemic risk remains contained for now. Keep an eye on yield trends and Fed actions for clearer signals.
 
syed putra said:
The US voters wanted a zero war gomen. But it seems the president is not in charge.
Click to expand...
There are checks and balances, including resistance within the US Govt against Donald Trump. Many of his executive actions and policies were challenged in federal courts, with judges often blocking them; this demonstrates that the judiciary serves as a check on his power. I cannot see this happening in S'pore where the PAP acts like a dictatorship with the Cabinet exercising absolute power.
 
True Believer said:
There are checks and balances, including resistance within the US Govt against Donald Trump. Many of his executive actions and policies were challenged in federal courts, with judges often blocking them; this demonstrates that the judiciary serves as a check on his power. I cannot see this happening in S'pore where the PAP acts like a dictatorship with the Cabinet exercising absolute power.
Click to expand...
Its not like that. Trump using emergency executive order to bypass checks and balances.
 
syed putra said:
Its not like that. Trump using emergency executive order to bypass checks and balances.
Click to expand...
You just confirmed my earlier post that the United States has checks and balances on the power of the President, but S'pore does not have any on the PM and his Cabinet. Thank you!
 
True Believer said:
You just confirmed my earlier post that the United States has checks and balances on the power of the President, but S'pore does not have any on the PM and his Cabinet. Thank you!
Click to expand...
The US has a more robust institutionalized system of checks and balances than Singapore, which is essentially a one-party dictatorship with no real separation of powers.

But a rogue President and a rogue admin can still override many of the built-in checks in the US system, as we're witnessing now. Ultimately no system in the world can stem a corrupt leader and government. The only saving grace is that Trump has only 4 years to wreak mayhem and cause untold suffering... we can only that the Americans will wake up when the next election comes.
 
superpower said:
The US has a more robust institutionalized system of checks and balances than Singapore, which is essentially a one-party dictatorship with no real separation of powers.But a rogue President and a rogue admin can still override many of the built-in checks in the US system, as we're witnessing now. Ultimately no system in the world can stem a corrupt leader and government. The only saving grace is that Trump has only 4 years to wreak mayhem and cause untold suffering... we can only that the Americans will wake up when the next election comes.
Click to expand...
So you admit that I what I wrote earlier is spot on - the US has a system of checks and balances, which S'pore does not because we have an unclean govt that does not wish to be controlled in any way. They just want to PAP - Plunder And Plunder.
 
True Believer said:
So you admit that I what I wrote earlier is spot on - the US has a system of checks and balances, which S'pore does not because we have an unclean govt that does not wish to be controlled in any way. They just want to PAP - Plunder And Plunder.
Click to expand...
Currently that check and balance system. In the US is broken. It has been made irrelevant.
 
superpower said:
we can only that the Americans will wake up when the next election comes.
Click to expand...
The next presidential candidate are chosen by the elites and deep state. By right, in 2016, and 2021, it was Bernie Sanders leading the Democratic primaries but was told to back off twice for deep states preference.
 
superpower said:
And you admit that the US system of 'checks and balances' can be largely ineffective in the face of a rogue Prez and his admin.:biggrin:
Click to expand...
We are in agreement. Just look at how SG's politicians can decide their own pay to 'legalise' the plunder instead of having to take risks by stealing public funds.
 
True Believer said:
We are in agreement. Just look at how SG's politicians can decide their own pay to 'legalise' the plunder instead of having to take risks by stealing public funds.
Click to expand...
Politicians pay are pegged to the current income of similar scale in the community.
 
superpower said:
The US has a more robust institutionalized system of checks and balances than Singapore, which is essentially a one-party dictatorship with no real separation of powers.

But a rogue President and a rogue admin can still override many of the built-in checks in the US system, as we're witnessing now. Ultimately no system in the world can stem a corrupt leader and government. The only saving grace is that Trump has only 4 years to wreak mayhem and cause untold suffering... we can only that the Americans will wake up when the next election comes.
Click to expand...

He's making the USA a better place for all Americans. It is the dems that caused untold suffering during Biden's term.
 
Leongsam said:
He's making the USA a better place for all Americans. It is the dems that caused untold suffering during Biden's term.
Click to expand...
No sure, things are really ex
There is no burger below USD8 at Mac
Cheap option like Cheese burger or Fillet P Fish are always sold out
 
k1976 said:
No sure, things are really ex
There is no burger below USD8 at Mac
Cheap option like Cheese burger or Fillet P Fish are always sold out
Click to expand...

There may be a few temporary setbacks while the tariffs bite but once the deals are done Americans will be way better off.
 
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