User Name: Password:      Register - Lost password?

Forex News Blog
Back to The Headlines
Thursday March 4, 2021 - 16:59:15 GMT -

Share This Story:
| | Email

When, If the US Bond Market Tipping Point Would Crash the Dollar?

When Clinton left office the US deficit was around $4 trillion. At the end of Bush’s term it had reached around $11 trillion. It then ballooned under Obama to around $20 trillion. As Biden takes over for Trump the deficit is approaching $28 trillion. With the acceleration of the deficit going unchecked, the question is what will be the tipping point where markets say “enough is enough.”

So far there seems to be little concern expressed about the limits of US deficit spending. Even with another $1.9 trillion, which has become a political football, about to be added to the deficit, it would be rare to hear any elected official ask, “What is the tipping point where there is a limit to how much the US can borrow.”.

Why is this important?

Up until now, markets have had a free lunch with US fiscal policy combined with Fed printing money to finance the deficit providing massive liquidity that has found its way into stocks, bonds, and more recently into commodities.  This is where there has been inflation while the Fed focuses on its own measures of price increases, which according to its criteria remain subdued. Whether this turns out to be asset bubbles of historic proportions remains to be seen, Much depends on whether bond markets behave or reach the tipping point where they say “no mas.”

What would tip the bond market and crash the dollar?

The trigger would not come from the domestic side but from foreign demand for US treasuries. This scenario would likely lead to a plunge in the US currency and a potential dollar crisis as foreigners demand a higher yield and/or abandon the market altogether. I am not saying this will lead to an Argentine-style financial crisis but the recent rise in US bond yields is a warning shot.

If I dug deep in my gut I would say it is a matter of when, not if the US spending spree will reach a tipping point but it is not something I would be willing to trade on in the short run. However, it is something to keep in mind as complacency is a dangerous word when it comes to trading.

Sign up for the Amazing Trader 

Sign up for the AT Ladder Strategy (includes 2 months Amazing Trader access)

Jay Meisler, co-founder

[email protected]





Forex Trading News

Forex Research

Daily Forex Market News
Forex news reports can be found on the forex research headlines page below. Here you will find real-time forex market news reports provided by respected contributors of currency trading information. Daily forex market news, weekly forex research and monthly forex news features can be found here.

Forex News
Real-time forex market news reports and features providing other currency trading information can be accessed by clicking on any of the headlines below. At the top of the forex blog page you will find the latest forex trading information. Scroll down the page if you are looking for less recent currency trading information. Scroll to the bottom of fx blog headlines and click on the link for past reports on forex. Currency world news reports from previous years can be found on the left sidebar under "FX Archives."

Actionable trading levels delivered LIVE to YOUR charts

GVI Trading. Potential Price Risk Scale
AA: Major, A: High, B: Medium

Mon 27 May 2019
AAGB/US- Holiday
Tue 28 May 2019
A 14:00 US- Consumer Confidence
C 13:00 US- Case-Shiller
Wed 29 May 2019
A 08:55 DE- Employment
AA 18:00 US- BOC Decision
A 18:30 US- EIA Crude
Thu 30 Mar 2019
AAEZ/CH- Holiday
A 12:30 US- Weekly Jobless
Fri 31 Mar 2019
AA 10:00 EZ- Flash HICP
A 12:30 US- Personal Income, Spending, Deflator
AA 14:00 US- Final Univ of Michigan

Global-View Affiliate Program

We are starting an affiliate program to market some of our products.

Send me an email if you would be interested or if you know someone who would like to be an affiliate. Generous commissions payout for those accepted.

Put the word "affiliate" in the email subject line.

Contact us

Start trading with forex broker Markets Cube


Retail Forex Brokerage Changing!

Are you looking for your first broker or do you need of a new one? There are more critical things to consider than you might have thought.

We were trading long before there were online brokers. Global-View has been directly involved with the industry since its infancy. We've seen everything and are up-to-data with recent regulatory changes.

Our Best Brokers listing section includes:Forex Broker Reviews, Forex Broker Directory, Forex Broker Comparisons and advice on How to Choose a Forex Broker

If would like guidance, advice, or have any concerns at all ASK US. We are here to help you.

SEE Our Best Brokers List

Currency Trading Tools

  • Live rates, currency news, fx charts. 

  • Research reports and currency forecasts.

  • Foreign Exchange database and history.

  • Weekly economic calendar.

Directory of  Forex trading tools

Terms of Use    Disclaimer    Privacy Policy    Contact    Site Map

Forex Forum
Forex Trading Forum
Forex Forum + forex rates
Forex Forum Archives
Forex Forum RSS
Free Registration

Trading Forums
Currency Forum Guide
Forum Directory
Political Forum
Forex Brokers
Compare Forex Brokers
Forex Broker News
Forex Broker Hotline

Forex Trading Tools
Currency Trading Tools
Forex Database
FX Chart Points
Risk/Carry Trade Chart Points
Economic Calendar
Quicklinks to Economic Data
Currency Futures Swaps
Fibonacci Calculator
Currency Futures Calculator

Forex Education
Forex Learning Center
FX Trading Basics Course
Forex Trading Course
Forex Trading Handbook

Forex Analysis
Forex Forecasts
Interest Rate Forecasts
Central Bank Forecasts

FX Charts and Quotes
Live FX Rates
Live Global Market Quotes
Live Forex Charts
US Dollar Index Chart
Global Chart Gallery
Daily Market Tracker
Forex News
Forex Blog
Forex News
Forex Blog Archives
Forex News RSS
Forex Services
The Amazing Trader
Forex Opportunities
Forex Affiliates
Forex CopyTrading
GVI Forex