Thus the mortgage investors forced Trump to freeze customs duties

In the days before the imposition of the long -standing customs duties on most imports on April 9, US President Donald Trump did not withdraw his position. It did not shake the collapse of the stock market, which lost more than $ 6 trillion market value. On the contrary, he was also not influenced by the objections of the leaders of the states (and some of his party members) about the fees. But in the hours that followed the entry of the fees, the Treasury bond market collapsed. Many investors in bonds, who were concerned that these fees could lead to the acceleration of inflation and a decline in foreign demand for US assets, began to go out of their belongings to push the US administration to withdraw the decision. The case succeeded: Trump announced just 13 hours after the start of the implementation of the fees that he was freezing. He said, “The bond market is very complicated,” and adds, “I watched it.” The warning of connection due to the fees is that the intense sale of bonds is a maximum alarm for any government. If the bonds are sold, their returns rise, that is, the return investors expect in exchange for lending to the government. The height of income means that governments have to pay more amounts to borrow. The governments usually use loans to finance the public services they provide, because their costs often exceed tax revenue and other sources. If the government continues to borrow with high returns, the benefits of religion will increase significantly. The continued intensive sale of bonds can make Trump’s implementation to reduce taxes, the most important local goal, is impossible without the budget deficit having a tremendous leap. So it withdrew. After the April 9 fees entered, the mortgage returns rose to more than 5%over 30 years, the highest level in two years. When Trump announced the freezing of the fees, returns fell to about 4.8%. For economist Ed Yardini, Trump’s decline is a new victory for what so -called “mortgage influences” are, and they are investors who sell effects to governments to change their economic policies that they consider reckless. Yardini, a veteran investment strategy, wrote after Trump announced the suspension of the drawings: “Bond investors have returned to a new blow.” He added: “What we see, especially with regard to the US financial markets, is the only one to achieve a 100% success rate.” How do influencers in the bond market? If the government spends more than income it earns, or accepts policy that are smarter inflation, the value of the effects tends to decline. Often, the government finances its spending through the issuance of bonds, and with its increasing offer, takes off the value of the effects in the possession of investors, assuming the stability of other factors. The high inflation also means that the benefit that investors get from their belongings will lose their future value. Forcing the government to change its policy and combat excess effects or inflation, investors jointly sell bonds. With this behavior, they affect the bond market. With the decline in bond prices, the returns rise to levels that make it impossible for the government to continue to borrow without the risk of not paying its debt and outbreak of a financial crisis. In a “strike of purchase”, the bonds influence the government to change the road and rearrange its financial situation, according to their vision. Yardini was the one who formulated this term in a 1983 research report, entitled “Bond Investors is an impact on the economy.” He wrote at the time: “If the financial and monetary authorities do not regulate the economy, the mortgage investors will ensure it.” He added: “The economy will be managed by the influencers in the credit market.” There is no official regulatory framework for the effects of effects, nor a targeted yield level, nor a well -known public figure. In fact, their number is countless, and they are individual investors and institutions, whether adults and children, and they move out of self -interest. Do these influencers have pressure on government decisions? Yes. One of the most famous victories of influencers in the bond market was in the 1990s. By threatening the ‘strike’, they forced President Bill Clinton to reduce his ambitious local agenda, which reduces tax for the middle class, rather to reduce the deficit. Clinton was surprised by the extent to which the bond market controls the fate of its program. In the book of journalist Bob Woodward in the White House during the Clinton era, “The Agenda”, Clinton was quoted as an evil for his assistants: “Do you mean that the success of the economic program and the election dependence of the federal reserve and a group of traded effects?” The influence of the bond market led to political adviser James Carville in 1993, saying: “I thought that if I went back to life, I wanted to be a president or the Vatican Papa or Pastpooler with a success rate of 400, but now I want to return as a bond market because he can scare everyone.” The effects of tires also in Sweden in the 1990s. At the time, the government recorded a major deficit, while the economy barely grew. Bullin Wallith, an investor in the insurance company “Skandia Group” in Stockholm, announced in July 1994 that it will not buy “one Swedish mortgage” unless the government reduces the deficit. When mortgage investors started selling, the government was forced to reduce spending. During the following decades, the activity of these influencers dropped significantly. Even after the financial crisis in 2008, when US debt rose due to incentives and the decline in tax revenue, investors had no policy impact. The Federal Reserve crossed the road by buying trillion dollars from government bonds, which kept the interest rates close to zero. This policy, in addition to low inflation due to poor economic growth, has helped yields at historically low levels. Thanks to the strong “federal” intervention, any sale of influencers was overlooked. The influencers are offset. How has the corona affiliation pave the bond market? The mortgage investors returned to the pandemic. The enormous incentives launched by governments around the world have inflation and raising public debt to unprecedented levels in the United States and others. In response, central banks raised interest rates sharply, which led to a record loss of 17% in returns on government bonds worldwide in 2022. In that year, the effects of the mortgage won a major victim. Investors were terrified because of the British government’s plan to implement the largest tax reduction since 1972, so they sold fast and easily bonds. The collapse in the market led to the resignation of Prime Minister Liz Eris after just 44 days in her position. In 2024, the global government debt exceeded 100 trillion dollars for the first time, and more governments put pressure on influencers of bonds. “The UK looks like the canary in the coal mine,” says Mark Daving, the investment investment in the RBC Global Management. He added: “The first thing the bond market wants to see is that the state lives within the boundaries of its capabilities.” Is the United States heading for a debt crisis? JD Vans, current vice president and Trump’s companion in the election race, said he was worried that the ‘bond market is a bond market’ in the second state of Trump. In a reference to a scenario in which the increase in debt increases the cost of loans, which leads to a slowdown in the economy, and makes the payment of the debt more difficult, and eventually explodes an economic crisis. Even after Trump was temporarily suspended on April 9, financial markets were concerned about the possibility of that “vortex”. After a short recovery, Treasury effects fell in collaboration with the dollar drop, an unusual mixture that undermines Trump’s unexpected customs policies to the confidence of investors in US assets. Now, Trump’s economic plans, including tax cuts, can lead to greater budget deficit, as well as the possibility of accelerating inflation. The billionaire and founder of the Bredwater Associats, said the crisis in which the US government loses the ability to finance its debt “will probably” happen “in the coming years” if the deficit is not significantly reduced. ” The American religion became near the size of the economy itself, that is, the poor level it was during the Clinton era. In the financial year 2024, the US deficit reached 6.4% the gross domestic product, which is usually recorded only during stagnation periods. The interest payments on the 28 trillion dollar debt alone were more than the United States on the national defense. How concerned about the mortgage investors about Trump’s agenda? There is no accurate way to measure the level of anxiety among mortgages, but what is known as ‘time bonus’ can be seen as an approximate indicator. It measures the additional returns that investors demand to keep long -term effects instead of a short -term debt. And as this bonus increases, it means that investors are increasingly concerned about the sustainability of US fiscal policies in the long run, and they are asking for higher compensation. A model of the ‘Federal Reserve’ in New York shows that the time bonus on the Treasury effects has risen to about 0.7% for ten years, a level that has not been recorded since 2014. Former hedge investor Scott Besent tried to calm the influential investors of Bond and said it would reduce Trump to reduce the deficit to 3% of the rough’s domestic product by ending the end of its mandate. He added that the solution to reducing the debt is to reduce government expenses, increase energy supplies to reduce inflation, apply motivational tax cuts and liberalize the economy from regulatory restrictions. However, investors still doubt the possibility of achieving this discount in spending and deficit. Yardini said: “Pesent implicitly recognizes the importance of the bond market, and it reminds us of what happened to Bill Clinton.” He continued: “The good news is that the deficit is a political problem,” and adds, “It can be solved, but it takes political will. Sometimes we have to scare politicians, and the influence of the connection can do it.”