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What Immigration Crackdowns And De-Dollarization Have In Common
Rule of law. It matters. In fact, it's the only thing that matters in the final analysis.
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Ah, remember the good old days when Wall Street “analysts” were advocating that investors buy Indian stocks rather than Chinese shares because India had a stronger rule of law?
For the moment the US is shielded by its reserve currency status. Will that be enough or will that Mara Lago Accord idea be put into play? Or good old fashioned capital export controls which might prevent foreign sellers of UST bonds from repatriating the cash?
Many question marks, partly because things that were deemed as crazy and totally unlikely a year ago don’t seem quite so impossible now.
It will be interesting to see how the worldwide ‘boycott USA’ movement impacts both the bond and stock markets.
indeed. its my understanding that US stock purchases by foreign investors declined from 180B in 2024 to 120Bin 2025. voting with their Dollars. Given US has such a low savings rate compared to the EU, I wonder how that might play into continued exUS stock outperformance.
Quiet quitting could be the new catchphrase for countries quitting the US, but not shouting it from the rooftops.
The rates on the Treasury curve and how much the world will demand for taking U.S. credit out the curve are far from a sure thing. . In the 1970’s under Jimmy Carter in late October 1978, climaxing November 1, other Central Banks refused to buy dollar bonds.It seems the U.S. could not selt dollar bonds as none trusted the Fed chair, G. Willim Miller, Cart’s recent appointee. Carter was forced to borrow other currencies, the first time in the 20th century – no one wanted dollar debt. The situation is far more dangerous now under Trump than it was then.
When I first saw “One Battle After Another,” I thought its fictional, dystopian plot to be a little too over the top. We seem a lot closer now, don’t we? During the Vietnam protests, it felt like the country was being torn in two. Eventually, we reached critical mass when the loss of life (on both sides), the cost of the war, and the atrocities being committed (both abroad and at home) no longer equated with any “stated goals.” At that point the actions and reasoning of our leaders simply did not hold-up to closer scrutiny, the protests become more widespread, and the tide turned. That process took years, however. I wonder how long it will take this time?