Criticism of President Donald Trump has been leveled against former US Treasury Secretary Janet Yellen, stressing that the Republican president’s economic policies are the “worst self-inflicted wound” that the government has inflicted on a well-functioning economy.
Yellen, who has also previously served as chairman of the US Federal Reserve (Fed), was making her first public comments since ending her tenure as Treasury secretary in the previous administration of Democratic President Joe Biden.
In her interview with CNN International, the former secretary stressed that the likelihood of a recession in the US economy has increased, noting that the threat of financial instability caused by the drop in US bond prices in recent days was what likely prompted Trump to reverse course and freeze most of tariffs that he had imposed on dozens of countries, U.S. trading partners.
The former Treasury secretary said US bond yields rose sharply amid the financial turmoil caused by Trump’s tariffs, leading investors to question the safe-haven status of US bonds.
“The tariffs have led high-leverage hedge funds that own US bonds to start selling US bonds that they own, and that’s something that could start to cause economic instability if there is massive selling of US bonds,” he said. “So as far as I can understand, this was something that influenced President Trump to lead him to freeze reciprocal tariffs, and that’s certainly something that should be of concern.”
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