Investors are selling off bonds from the U.S. government, as part of a trade known as “Sell America.”
The United States government has had to pay more to borrow in the global debt markets. On Wednesday, the Treasury department found that there was tepid demand for an auction for $20 billion worth of bonds, and ended up paying a slightly higher interest rate (or yield) than expected.
This has spooked markets. Yields on 30-year U.S. Treasuries have spiked above 5% this week — an unusual, and unsettling, surge in the price that the U.S. government pays on its long-term debt. An increase in bond yields is particularly damaging to the economy because it jacks up the interest rates on many things that consumers pay, such as on mortgages and other loans.
Of course it’s deliberate. Trump launched a trade war against the world and massively overplayed his hand. This is going to be devastating to the US economy for decades. But at the same time, they are cancelling the constitution so citizens don’t get to vote anymore, they’re just along for the horrible ride.
The reason I thought it was notable when my brother told me that is because all the articles I’ve seen, including this one, imply that the only reason bonds aren’t selling is just that people are nervous about the unstable situation and unreliability of the US to honor the debt. They don’t mention a coordinated act of retaliation by a group of governments.