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‘The damage is done’: Trump’s tariffs put the dollar’s safe haven status in jeopardy

Sven
in Other Investing
Friday USD dollar fell against other major currencies and yields of 10 and 30 years Treasuy notes rose. Just about all US bonds fell accordingly. Excerpt from the enclosed articles:
The sudden loss of confidence has been stark in the US Treasury market, widely considered to be the most important in the world because investors normally use it as the “risk free” benchmark to determine the price of every other financial asset.

In the sharpest weekly move since 1982, the yield – in effect the interest rate – on 30-year US government bonds rose from about 4.4% to 4.8%. The yield on 10-year bonds has also risen.
https://theguardian.com/business/2025/apr/11/the-damage-is-done-trumps-tariffs-put-the-dollars-global-reserve-status-at-risk

What are the options for income investors?

Comments

  • CrashCrash
    edited April 12
    It pleases his daddy, Vlad. Options? I'm out of Junk. Don't like to trade often. Hiding in MMkt, and added to WCPNX. But look what happened today: Junk UP, I.G. DOWN. Harumph. My own portfolio's yield is down from over 4% to a bit over 2%. Two stocks give me quarterlies. 42% stocks, 31 bonds, but now up to 25% cash in the portfolio. I'd rather bleed slower than faster, and who knows what wild pretext will be employed from out of the WH so that Orange can declare a "win" re: tariffs.
  • CrashCrash
    edited April 12
    A perhaps unlikely option came to mind: Against my better judgment, here's a list of Israel Bond rates. Purchase with US dollars, interest paid in US dollars. Unless they've moved, HQ is in NJ. They have never defaulted. If you're looking for not bad (at all!) rates, their gov't has a great reputation with bond investors. Most of these pay only twice per year, however. I did well one time, many years ago, with a 10-year zero coupon bond from them.
    https://www.israelbonds.com/Offerings-Rates/Current-Rates.aspx
  • Observant1
    edited April 12
    Don't know how this situation will evolve but am concerned.
    We have the exorbitant privilege of the USD being the global reserve currency.
    Treasury bonds are safe havens during market crises but they recently failed to provide any safety.
    Hedge fund activity (basis trade) may be the cause of some Treasury bond disruption this week.
  • Sven
    edited April 12
    Hedge fund activity (basis trade) may be the cause of some Treasury bond disruption this week.
    Several reporting pointed to hedge funds. Do we know how much selling in dollars term ? Can there other sources including other foreign countries that contribute to this selling ?

    When both stocks and bonds fall simultaneously, that is very concerning as the time period of 2022.

    @Crash and @Observant, Thank you for your suggestions. Will do more research for international bonds on MFO Premium, and post what I learn..
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