Picture this: Billionaire wizard of money, Ray Dalio, squinting solemnly and declaring America might be waltzing straight into a “1930s-style autocracy” – whatever weird dance that is. He reckons this political hullabaloo could send long-term US bond yields sky high, the dollar tumbling like a clumsy acrobat, and gold shimmering brighter than grandma’s antique brooch.
Sure enough, today those long-term bond yields took a grand leap upwards. The crowd at the financial circus is on the edge of their seats, wondering if Bitcoin will join the party and shoot up like a rocket fueled by fairy dust.
Trump’s Fed Hijinks: The Circus Act Nobody Asked For
Dalio spilled the beans in a chinwag with the Financial Times, describing the “1930s-style autocracy” as Trump’s version of “Let’s meddle in the market and stir the pot.” Case in point: the government buying 10% of Intel-a company apparently more troubled than a cat in a room full of rocking chairs.
He also grumbled about America’s wealth gap getting wider than a hippo’s yawn, fraying social trust quicker than a pair of old socks. This rift is apparently breeding extreme policies and enough political drama to fill a season of the wildest soap operas.
Then there’s the president’s recent Fed shenanigans-like giving the boot to board member Lisa Cook-shouting from the rooftops: “The Fed is now my playground!” Dalio warns that if the Fed caves to this pressure-cooker politics and keeps interest rates tiptoeing low, folks will start doubting if the Fed can actually keep the dollar’s value from turning into Monopoly money.
He’s certainly not alone in the worry corner. ECB head honcho Christine Lagarde chimed in, waving a big red flag on Monday, warning that Trump’s Fed tampering isn’t just a local mess but a “very serious risk” to both Uncle Sam’s economy and the globe’s.
Gold Glittering as Bonds and Dollars Trip Over Themselves
Dalio predicts that if Trump’s solo show continues, long-term bond yields will leap louder than a frog on pogo sticks, the dollar will wobble like jelly on a rollercoaster, and gold will sparkle like a pirate’s treasure chest. Some clever international investors have apparently switched from Treasury snoozefests to gold’s shiny allure.
On the 2nd of September, the 30-year US Treasury bond yield catapulted to a jaw-dropping 4.982%. Meanwhile, gold futures wrapped up the day at a record $3,604 an ounce – enough to make even the most frugal crow gobble with envy. While short-term bonds are sulking low, hoping for interest rate cuts, the long-term ones are on a steadfast uphill climb.
The financial fortune-tellers are all eyes and ears, curious if this dazzling drama might send Bitcoin soaring too, like it did last April during the tariff skirmish when gold and Bitcoin played tag along with bond yields.
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2025-09-03 17:25