Is the bond market part of the balance of power in Washington?

I'm David Brancaccio in Los Angeles with the President's Party holding both houses of Congress with multiple allies at the Supreme Court.

Is it me being facetious? Or is there an argument that the bond market has become the remaining check on executive power in America?

President Trump explained his dramatic turnaround

on tariffs on Wednesday as a consequence of people, presumably investors, getting, quote, yippy. That's a

golf term, when nerves give you the yips on the fairway. Christopher Lowe, chief economist at FHN

Financial in New York, has been watching those yippy signals from markets. Morning, Chris.

Good morning, David. So, I mean, among the signs of yippy behavior, bond yields falling,

even as stocks were falling in tandem, dollar falling. That was sending a signal.

It was. And we've seen it before. We saw it during the housing crisis. We saw it during

the pandemic. Effectively, people have lost so much money in trades, and they're probably

levered. They're getting margin calls. We did hear that from British bank regulators. And so they start looking for ways to raise cash. And if you're

forced to raise cash, you don't sell the thing that's down 80%. You sell the thing that's actually

up in price that still has value. And so they started selling treasuries. And then stepping back, I mean, why were they so

yippy financial market players? This is the sense that tariffs cut into profits, cut into

consumption, could raise the risk of recession, right? Well, yeah, absolutely. That's where it started.

And there's no doubt, right? J.P. Morgan, Goldman Sachs, all warning that global recession was likely, given the level where those tariffs were set. And I think that's really the most important element in this. We all knew we were getting global tariffs on April 2nd.

No one expected them to be as high as they were. And as Howard Lutnik explained, the president

decided it would give the U.S. negotiating advantage. And while that might make sense from a

negotiating standpoint, it obviously had a

devastating impact on financial markets. Yeah. And at the time, prior to the turnaround on

reciprocal tariffs, the president was making statements on social media saying that he's

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