Illegal immigrants? Backtracking. Tariffs? Backtracking. Ukraine peace in 24 hours? Backtracking. 90 days? Backtracking? Stop supporting Ukraine? Backtracking. War against Iran? Backtracking. Deportation of Palestinians? Not yet.
From NBC News:
Trump floats plan for undocumented farm and hotel workers to work legally in the U.S.
The president’s comments suggested a vague plan that would allow the government to bring back “great” people who are “working hard” and who “go out … in a nice way.”
President Donald Trump suggested at a Cabinet meeting Thursday that undocumented people working on farms and in hotels would be allowed to leave the country and return as legal workers if their employers vouched for them.
Trump said at the meeting with reporters present that “we have to take care of our farmers, the hotels and, you know, the various places where they tend to, where they tend to need people.”
“So a farmer will come in with a letter concerning certain people, saying they’re great, they’re working hard. We’re going to slow it down a little bit for them, and then we’re going to ultimately bring them back. They’ll go out. They’re going to come back as legal workers.”
It was unclear what he meant by “slow it down a little bit for them.” The administration has been pouring resources into arresting, detaining and deporting undocumented immigrants to fulfill Trump’s campaign pledge to conduct a history-making mass deportation of immigrants from the United States.
Trump said the administration is going to work with people if they “go out … in a nice way.” (Full article.)
BlackRock CEO Larry Fink:
“The sweeping US tariff announcements went beyond anything I could have imagined in my 49 years in finance”
Trump is quickly losing the support of Wall Street Investors.
From Bloomberg:
BlackRock Inc. Chief Executive Officer Larry Fink said he was caught by surprise at the breadth of President Donald Trump’s tariffs last week on many countries, including key US trading partners.
“The sweeping US tariff announcements went beyond anything I could have imagined in my 49 years in finance,” Fink said on a call on Friday with analysts after the company reported first-quarter financial results.
The president imposed the steepest tariffs in a century on April 2, sparking markets to sell off around the globe. On April 3 and 4, the S&P 500 Index had its steepest two-day plunge since the March 2020 onset of the pandemic.
“This isn’t Wall Street versus Main Street,” Fink told analysts Friday.
“The market downturn impacts millions of ordinary people’s retirement savings.”
The US is either very close to a recession or already in one, Fink said in a CNBC interview after the analyst call. He said he was shocked at the 10-Year Treasury’s reaction in the wake of Trump’s tariffs. (Full article.)
Asia’s central banks hold and can dump $3 trillion worth of US Treasuries, leverage that could ultimately put the Tariff Man in line
From Asia Times:
The real bond vigilantes hounding Trump are Asian
The dollar extended its biggest plunge in three years on Friday after China raised tariffs on the US to 125% from 84%, a tit-for-tat step that has gold surging, markets everywhere gyrating and investors more uncertain than ever about the global economic and financial outlook.
It’s now US President Donald Trump’s move. Does the Trump 2.0 White House double down and increase its own tariff rate, now at 145%, on Asia’s biggest economy? Trump, after all, has threatened before a 200% levy on certain Chinese products.
Perhaps most interesting about this week is what global investors learned about the Trump 2.0’s pain threshold. Punters learned – to their horror – that Trump is willing to stomach epic stock market losses but not telltale signs of distress in the bond market.
Posterity will show that it wasn’t the US Congress, the judiciary or voters that forced the US president into a more relational tariff policy. It was bond traders.
In Asian trading hours on April 9, the so-called “bond vigilantes” pushed the yield on 30-year US Treasury bonds above 5%, Bloomberg reported. That — and memories of events from the mid-1990s, mid-2000s and the Silicon Valley Bank bust in 2023 — saw Trump beat a hasty and rare retreat on most tariffs.
Yet it’s concerns about the next round of vigilantes to take on the Trump White House that made him blink: Asian central banks.
Central banks in the region hold roughly US$3 trillion of US Treasuries, with Japan and China, the top holders, sitting on a combined $1.9 trillion. If they were to start selling on a significant scale, who could pick up the slack?
Other than the largest global banks buying steadily, arguably no one.
That’s why chatter in bond trading pits this week that Japan, China and other Asian monetary authorities might be selling so alarmed top US Treasury Department officials.
For years, traders feared China might dump its trove of US T-bills in retaliation against US sanctions and restrictions. That day may have arrived.
China, after all, has an incentive to show that “it won’t hesitate to cause turmoil in the global financial market in order to improve its negotiating power against the US,” says strategist Ataru Okumura at SMBC Nikko Securities. (Full article.)
