Why it matters that foreign investors are selling U.S. government bonds

Investors traditionally have bought U.S. Treasuries on the assumption that, no matter what, the U.S. government will be there and will stand by its debts, says The New York Times.

But turmoil in the bond markets last week showed the extent to which President Trump’s trade war has damaged American credibility as a responsible steward of peace and prosperity, the Times says.

“The whole world has decided that the U.S. government has no idea what it’s doing,” says Mark Blyth, a political economist at Brown University and co-author of the forthcoming book “Inflation: A Guide for Users and Losers.”