U.S. Economy and its Mess

[rareboy]

The US debt is widely held, but 1/3 is held by NATO countries.

Invading a NATO state would be like pulling the pin in a grenade inside a crowded elevator.

Although I expect the US would just cancel its debt to NATO countries.

 

[rareboy]

TrumpCo. either doesn't actually understand this or they do and they are trying to wreck US currency. This is one of the most succinct summations I have run across of why TrumpCo.
has it all wrong.

 

[rareboy]

 

[KaraBulut]

It's flu season, and I suspect that Trump might end up with John Paul I flu.

 

[rareboy]

We can all wish...but his type of evil just thrives on all of this.

I am not even sure that silver or wooden stakes will be effective.

But if the entire US financial and other industrial CEOs and leaders aren't running around today without their hair on fire and trying to get this madman under restraint,
TrumpCo. is likely to precipitate a crash in the markets that most of us over 60 will never recover from in our lifetimes.

 

[rareboy]

Again...file under duhhhhhhhhhhhhhhhhhhhhhh.....

You bet your ass that if the US declares war on a NATO country, that the revenge will be dumping US assets by allies and then across the board as everyone tries to limit the
damage.

Bessent and the billionaires may actually be counting on this...a huge depression in asset values which they believe will be short term and bounce back once the US starts to
make noise about how they are going to exploit Greenalnd's resources.

https://www.cnbc.com/2026/01/20/ray-dalio-fears-capital-wars-could-follow-trumps-actions-with-countries-dumping-us-assets.html

 

[rareboy]

I have sent off concerns I have to my investment manager asking about exposure to US debt and what they think is being done to brace for a dumping of treasuries and other
US based debt issuers.

Because of tariffs, we have already decoupled from US companies we used to invest in because we see the future impact on revenue if consumers pull back from purchases because of
higher prices for shit they don't urgently need today.

But this week, I see the real possibility where TrumpCo. are literally throwing the US markets into potential chaos in order to steal Greenland.

 

[KaraBulut]

This is very typical Trump: threatening to blow everything up as a "bargaining strategy". This is how he did business. It's also how he ended up in bankruptcy.

The only answer to this is for Congress to wake up and get a reality check. Presidents aren't allowed to use America's economy as a bargaining chip.

I've said this before: America is a country that has a single word for "coup" because they don't have coups and therefore don't have to delineate between different kinds of coups. If Congress (or specifically, Republicans and their media echo chambere) don't wake up and start talking seriously about removing Trump, they're going to have a bigger mess on their hands.

 

[KaraBulut]

Great news is you're on the assets side of the ledger; bad news if you're on the liability side.

 

[rareboy]

Canadian PM Carney:

"American hegemony in particular helped provide public goods, a stable financial system... this bargain no longer works. Let me be direct. We are in the midst of a rupture, not a transition... recently, great powers have begun using economic integration as a weapon. Tariffs as leverage ... "

 

[rareboy]

The S+P not happy today either.

 

[rareboy]

I am old enough to remember when people used to wonder about gold reaching $2000 per ounce.

Today it has jumped again. At about $6580 mid afternoon.

A year ago it was about $3700.

This is what nervousness about TrumpCo. is doing to the market as investors look for security.

Gold Price Canada

GOLDPRICE.ORG - The number 1 web site for Canada spot gold price charts in ounces, grams and kilos.

goldprice.org

 

[KaraBulut]

 

[rareboy]

Now if this is all just another TACO stock market manipulation, we can be sure that he and his cronies are all making billions from this.

 

[rareboy]

China is selling off more of its US treasuries. The graph is most interesting though.

It shows a period where China buying US debt while supplying shit cheap was the great bargain. For all intents and purposes, China was subsidizing the US by being one of the best customers for its debt.

There is no such illusion now. While TrumpCo. may have been able to strongarm other countries into agreeing to 'invest' trillions in America by buying treasuries in exchange for
reduced tariffs this economic warfare tactic means nothing to China who also now seem to be shifting to gold as a safer hedge against US instability.

https://www.moneymetals.com/news/2024/04/19/china-is-dumping-us-treasuries-and-buying-gold-003133

 

[Norri]

Selling off not good for the US, stop buying a much bigger, and immediate, problem.

 

[rareboy]

^ As long as the Fed has to keep raising the interest paid on bonds and/or discounting the price, there will be buyers...even when they reach near junk bond status.

 

[KaraBulut]

^ As long as the Fed has to keep raising the interest paid on bonds and/or discounting the price, there will be buyers...even when they reach near junk bond status.

It's important to remind the public that these aren't ordinary investment instruments. These bonds are how the United States is able to run up trillions of dollars in deficits, yet still pay employees, buy bombs, keep millions of DHS and DoD employees and look like the big bully of the world. The US is like your neighbor who drives expensive cars, has lavish parties, has children wearing designer clothes and is always taking expensive vacations, but behind the scenes, they are up to their eyeballs in debt.

Given the games Congress keeps playing with deficits, shutdowns and underfunding the government, it's really just a matter of time before they default on payments and the bond ratings are lowered.

 

[rareboy]

I think sometimes think that based on his own history, Trump intends on defaulting on US debt, but he needs the US to own the entire western hemisphere at this point to prop it up. One of the reasons that TrumpCo. is so intent on owning Greenland is as backing for running up even more debt. I suspect that even if the US offered a trillion dollars for Greenland and it was accepted, Denmark and the debt holders would never see their investment back.

I spent the afternoon with my investment manager yesterday and we had some far ranging discussions on US debt, equities, gold and Greenland.

 

[rareboy]

Another European Pension fund dumping US debt.

Swedish pension fund Alecta cuts US Treasury holdings, citing policy uncertainty

Swedish pension fund Alecta has sold most of its holdings in U.S. Treasuries over the last year because of the increased risk and unpredictability of U.S. politics, the fund's chief investment officer said on Wednesday.

www.reuters.com