This is why all the maga theories about some 4d chess of refinancing at lower rates by crashing the economy never made sense. People can simply choose not to buy treasuries with low rates
tankmode on
not a macro economist but pretty sure the US pays foreign countries for all of its imports in dollars, to prevent local currency appretiation those countries put those dollars right back in to the US and buy long dated treasuries. (dollar debt is the US best & biggest export)
guess what happens when the US suddenly stops imports?
theorizable on
Not a good outlook I’d say.
johnson_alleycat on
But is it worse than having the same amount in the stock market in a typical stock heavy fund?
4 Comments
This is why all the maga theories about some 4d chess of refinancing at lower rates by crashing the economy never made sense. People can simply choose not to buy treasuries with low rates
not a macro economist but pretty sure the US pays foreign countries for all of its imports in dollars, to prevent local currency appretiation those countries put those dollars right back in to the US and buy long dated treasuries. (dollar debt is the US best & biggest export)
guess what happens when the US suddenly stops imports?
Not a good outlook I’d say.
But is it worse than having the same amount in the stock market in a typical stock heavy fund?
Please answer quickly my portfolio is dying