Federal Reserve Kashkari: Investors are pulling out of the United States

Mr. Kashkari, the Federal Reserve, said on Friday that recent market trends showed investors were leaving the US as the safest place to invest as Mr. Trump's trade war escalates. He said the dollar had fallen against global currencies in recent days as Treasury yields have risen, a trend that is the opposite of what you would normally see. "Normally, when you see a big increase in tariffs, I would expect the dollar to appreciate. I think the fact that the dollar is falling at the same time gives more credence to the idea of a shift in investor preferences," Mr. Kashkari said. He added: "Investors around the world see the US as the best place to invest, and if that were the case, we would have a trade deficit. So one way that is manifesting itself now is lower yields across all asset classes in the US." If the trade deficit goes down, investors might say, well, the U.S. is no longer the most attractive place in the world to invest, and then you're going to see bond yields go up. "Kashkari, however, noted that he's seeing" stress "in the functioning of markets, not serious disruption. (CNBC)