“US exceptionalism is backwards” markets ignore fate and draw record foreign influx after panic over Trump’s tariffs

• Foreign investors have returned to US stocks and bonds It came into effect in May, just a month after President Donald Trump’s unexpectedly aggressive tariffs retreated. New data shows a record net influx as the highest tariff rates were pending to allow breathing chambers for trade consultations. U.S. stocks have since taken record highs, but bond yields remained rising.

Just as American consumers have shown extraordinary resilience amid President Donald Trump’s tariffs, foreign investors clearly have a strong stomach due to market disruption.

Latest Data from the Ministry of Finance It shows foreigners plowed $311.1 billion into US securities in May after withdrawing $14.2 billion in April.

“All of this is worth noting because many commentators prophesied our “exceptionism” because they ended our “exceptionism,” so this is all worth noting.” Subsack. “The reality is that the market accepts all the ups and downs much more than people realize. Our ‘exceptionalism’ is alive and well. ”

Meanwhile, between May and May, net foreign inflows have reached an all-time high of over $1.4 trillion since July 2023. American exceptionalism The story in the market, he added.

The May rebound marks a spectacular turn from April. Wall Street feared the end of US hegemony in the world economy and markets.

Shortly after the “liberation day,” the S&P 500 flirted in the bear market, crashing nearly 20% from the previous highs, Nasdaq I passed that threshold.

Treasury yields initially fell sharply in 2010, but they exceeded 70 basis points in just a few days as investors worried that US debt holders would abandon their holdings.

But a month later, the opposition happened.

“The hurdles for the US to experience a real capital flight were high and certainly not breached in April,” Brooks wrote.

Certainly, the 10-year yield exceeds the level of the day before liberalization, and the dollar has suffered in the worst first half of over 50 years.

And while the S&P 500 and Nasdaq have regained previous records and continue to charge even higher. European and Chinese stock indexes are still excellent Our rival.

Meanwhile, talks between Japan and its trading partners have solidified tariff rates higher than the initial 10% baseline. Negotiations with other countries are still underway and if the transaction is not reached, tariff charges could be even higher.