Konrad Yakabuski writes:

It has taken fewer than 100 days for Donald Trump to transform the United States from the world’s most reliable safe haven for global investors into a speculative bet, a country too unpredictable, unstable and lawless in which to risk storing their assets. That is quite the feat.

This week, the floundering U.S. President was finally brought to heel, if only momentarily, when investors dumped U.S. Treasury bonds, in part a reaction to his erratic policy shifts and their potentially devastating impact on America’s finances, credibility and ability to honour its debts.

It takes a lot to tank U.S. Treasuries. The bonds have long been considered the gold standard in international finance, an asset so secure that investors typically load up on them whenever turmoil hits the markets.

Not anymore. Mr. Trump’s chaotic undoing of much of the postwar global order that the United States had forged has dealt a near-fatal blow to investor confidence in America’s willingness to play by the very rules it helped create. [Continue reading…]