(Bloomberg) Here’s another reason Donald Trump is “not at all happy with the Fed” and will continue to be frustrated by the world’s No. 2 economy. He is the first president to suffer the new normal of China becoming more creditworthy than the U.S. That’s right: America now pays more to borrow money than China does.
Liquidity moves markets!Follow the money. Find the profits!
Since 2015, when the Federal Reserve began raising interest rates, the gap between the countries’ Treasury bills has narrowed and then reversed, so that now the U.S. must offer higher yields than China when it sells one-year paper. That happened for the first time in November, when the spread between Chinese and American 10-year notes also collapsed, according to data compiled by Bloomberg.
To be perfectily fair, one cannot blame years of fiscal mafeasance by Congress and former Presidents on Trump. Democrats in Congress are a big offender in over-spending derby in DC. And big government Republicans too.
It is interesting to watch as 30-year mortgage rates fall as Europe and China PMI continue to cool.
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