What stops to lose from US gear dollars

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Trump management has already exceeded the situation of the dollar as the main load of global finance. Would miss you very much if he grew.

It still feels wild to discuss all of this. Close the drum for the drum, which delivers the role of the drum, which has been delivered to the role of the dominant reserve for many years, was a niche hobby for LINQT. Some large investors are still here, without a serious alternative to its status, the powerful dollar is here to stay here. Others note that the dollar doubts donate the weakness of weakness in Buck with a safe port and lubricant for global trade.

These boosts are both blindfold in security politics and geopolitics since Donald Trump re-enters the White House. It is sensitive to thinking about the fact that the United States stands to lose. Currently, it is shorter and less solid in the market and great power policy, less solid and will remain more to the goodness of strangers.

The long-term president of the Peterson Institute of Economics Adam is among the difficult economists that continue with a conversion on this issue. Back in 2008, wrote a paper called “Why will the Euro dollar opponent“After that, the euro” is on the peak of temporary impact, and the dollar will continue to take advantage of the geopolitical sources of the global role that the euro is still eligible or soon. “

At the moment, Trump, the opening of the last large construction project, was engaged in a tower in the bright Trump International Hotel and Chicago. Posen can be forgiven as the rest, it can be forgiven to retreat, then this Trump can end as the leader of the free world again in 2025. But here.

Now Posen told a Charming online presentation Last week, a sharp change in the president’s foreign policy creates a direct and serious risk for the foundation of the dollar. Trump has been something that has been something that has been one since the announcement of unusual tariffs since April 2. However, the cost of the long-term US government bonds of the United States is a completely different thing – the dominant reserve currency has died, but it is very strong evidence.

An important element here is that all US government bonds are not created equal. Trump, when the markets were exploded with the announcement of vibration tariffs, the short-term treasures with a minor for two years – a typical reflection of a shocking expectation that can be necessary to cut interest rate. The so-called “consistent active hedge property decrease in a safe active hedge property”, the word of a “owners), one’s word New analysis Viral Acharia and Toomas Lahariits at the University of New York University Stern.

In normal periods, bonds and currencies are higher and lower based on growth, inflation and interest rates. However, these are not normal times and as we have seen, the lesser of foreign policy and geopolitics sits all the sits. It complicates – it is difficult, but not difficult – to see how dollars and treasures can recover history as reliable security valves for Skittish markets.

This imbalance between short-term and long-term treasures means that it is likely to bend more than the US cheaper short-term debt. Typically, the United States is such a responsible, secure and reliable borrower, it is something that can affect the debt of the treasurer never – can only give new bonds to pay for old. Tilt than long-term, it will be more often a task, and the US creditors will be more often a task that requires you to keep the loan costs sweet.

The great privilege of hosting the currency and bond market in the world where the world wants to have a crisis, it means that the United States can be easier than any other country and even the native problem. Historically, it has been able to touch a reliable investment well in a reasonable investment well, and in almost any other nationality, stimulating their way more freely than other nations, it is often increasingly when debt costs are difficult.

The new US leadership can convince this world how it works. It should not be understandable, but should not be liked, and Europe loved him a magical slice.

Safe assets are safe because everyone thinks they are safe. The United States is good to find the long-term value when these cracks are.

katie.martin@ft.com