Trump goes on $100 million bond-buying spree: Here’s what it could signal about future interest rates
President Donald Trump has gone to the outbreak of bonds since he took office, and according to what was drowned more than $ 100 million in debts issued by major companies and municipal governments alike.
Trump put millions of dollars behind the bond strategy in February, including between $ 500,000 and $ 1 million in bonds issued by companies such as Home Depot, T-Mobile and United Healthcare. Another bet of $ 250,000 and $ 500,000 in the debts issued by Meta, based on the CNBC account for 690 transactions reported to the government ethics office since January and published on Tuesday. He also bought debts issued by local American governments, gas areas, water supply provinces, hospital authorities, and school councils, according to CNBC.
The White House did not respond immediately luckRequest to comment.
Investors usually resort to bonds because they are less volatile than stocks. The bond is like a loan that pays interest to the investor, and is usually semi -final, over a specified period. Once that period ends and the bond reaches the stage of maturity, the investor gets his main investment.
Trump’s hatred to buy bonds emerge because, unlike other presidents, he did not put his investments in real blind confidence. Rhodes, a clinical associate professor of financial management at Indiana University, said that Trump’s bond purchases, whether he was directing him or the person responsible for his financial resources, appears to be the usual bet for a deep investor-who is believed to be interesting prices to decrease.
Since bond prices usually rise when interest rates decrease, Trump is likely to make bets in the hope that he can later sell bonds with profit. Rhodes said the prices are likely to decrease faster for corporate bonds compared to government bonds because they are more dangerous. Rhodes added that Trump’s additional pressure on the Federal Reserve to reduce prices could be closer to “talking about his book.”
“You can take the way he was pressing so that the Federal Reserve can reduce prices such as CNBC wallet manager and speak positively about the shares, which is a large registrar to try to make others buy them,” Rhodes told Rhodes. luck.
Federal Reserve and interest rates
The Federal Reserve has retained the interest rates steadily at between 4.25 % and 4.5 % since late 2024, although some investors are looking for a September meeting of the Central Bank to reduce the potential interest rate.
Trump’s purchase of municipal bonds, issued by government governments and local governments, can be part of the investment strategy, because the benefit that results in general exempt from federal income taxes. A bond from the mother state will generally be exempted from the state taxes. With the stock market near its highest levels, the preference of bonds may be wise.
Rhodes said: “It is just a step to manage the logical governor, unlike, as you know, something he knows about the prices that the rest of us does not know.”
Trump maintained the final control of his business and investments, while delegating responsibility for his commercial empire to his children, Donald Trump Junior and Eric Trump. According to what was reported, the president and his direct family witnessed profits of $ 3.4 billion in his term, especially those who dealt with encryption, the New Yorker I mentioned. The president and the vice president are exempted from the main law that aims to prevent conflicts of interest by government officials.
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2025-08-21 18:34:00
