There’s a theory being batted around without too much evidence (hold tight, Snopes is on it) that Mark Carney talked European and Japanese leaders into accumulating US Treasury bonds, and then slow-selling them to make Trump squirm once he imposed the broad-brush tariffs to spook the T-bill market.
The theory sounds mostly plausible in that Carney was in Europe for closed door meetings with European leaders shortly after being designated PM, and that Trump backed off so quickly and used the language of “the bond market is tricky” to justify the change in direction. Dropping demand for T-bills leads the Fed to increase yields to keep the borrowing taps on, means expensive borrowing for them, means no money for tax cuts for billionaires.
On the other hand, the story originates from a twice-fired shock-jock’s Substack.
But it sounds like something a wicked smart Harvard/Oxford educated economist would dream up and pull off…
¯\(ツ)/¯
That was my initial reaction, thinking China MUST hold more treasury bonds than anyone else, right? Turns out that’s typically Japan ($1 trillion), and the UK has generally held roughly the same number as China (both in the $700B range). Maybe the US anticipated and had contingencies ready if it was just China doing the selling, but when the other big holders started a slow bleed, it might’ve given them pause? Dunno.
We also don’t know who held what more recently than January and I don’t know if the data gap is the usual lag or if the the people who do this work at the Treasury department got “DOGE’d”.
Bottom line, it’s been fun to think about but I don’t think we should put too much stock in conspiracy theories originating on Substack.