🇺🇸 The Dollar and US Treasuries Are Losing Their Appeal: No Enemy More Dangerous Than the US President Himself
Why did the dollar fall and Treasury yields rise amid market panic?
The US Treasury market deserves a separate analysis. Many investors, stuck in the old paradigm, assumed that financial instability would trigger the familiar “flight to safety” — meaning a move into the dollar and Treasuries. But that playbook no longer applies.
Historically, during crises (like 2008, the rate-hike cycle since 2015, or the early COVID shock), the dollar surged — by 25% in 2008, another 25% from 2015, and nearly 9% in early 2020.
But now, the opposite is happening. Since late February 2025, the dollar has lost nearly 6% at its lowest and is still down 4.5%. In the most intense phase of panic (April 3–9), it fell 2.8% intraday and settled at -1.5%.
Even more surprising: the erratic behavior of Treasuries. On April 4, the 10-year Treasury yield dropped from 4.2% to 3.9% — a typical “flight to safety” move. But by April 7, the trend reversed sharply: yields surged to 4.5%, the biggest move since 2020.
The 30-year bond yield jumped from 4.35% to 5% in two days, triggering concerns about failed auctions and shattered confidence.
Why this reversal of logic?
1. Trump’s Chaotic Governance
Trump’s erratic leadership has become a core market destabilizer. He doesn’t follow rules or norms — and markets hate uncertainty. Investment horizons have shrunk from 30 years to... a single day. No one knows what policy or tariff he’ll announce next. Is it 125% duties on a $600B trade partner? Why not 500% tomorrow?
There’s no logic or strategy — just impulsive, chaotic actions fueled by narcissism and vendettas. The financial market sees him as a loose cannon, incapable of long-term planning.
Money follows intelligence and predictability — not volatile whims.
2. Rising Inflation Risk
Trump’s tariff wars are inflating global costs and expectations. The result? Persistent inflation fears and a risk of stagflation.
3. International Investors Backing Out
Major holders of US debt — like China and the EU — are reconsidering exposure. Trump’s hostile foreign policy, insults to allies, and economic unpredictability may push them to exit dollar-denominated assets. This trend began right after his 2024 victory.
4. Technical Margin Call Waves
Finally, a short-term but relevant reason: margin calls forced hedge funds and traders to liquidate even “safe” assets like Treasuries, especially as they stop acting like a safe haven.
🔗 Source / Proof:
Original post by financial analyst @spydell
📎 https://t.me/spydell_finance/7416
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📚 Библиография:
Telegram, Spydell Finance: t.me/spydell_finance/7416
U.S. Department of the Treasury: home.treasury.gov
Federal Reserve Data: federalreserve.gov
Market data from Bloomberg, Reuters, and TradingEconomics
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