The "full faith and credit of the United States" isn't what it use to be.
Donald Trump changed all of that, and now even the bond markets have begun to notice. Hence, Wednesday's White House panic, and Trump's rescinding of many of his "permanent" tariffs—again.The United States has long been seen as one of the most stable countries in the world. Because of that, most of the world has been willing to put their trust in us. That together with the eminence size of the US, and its vast economic resources, has made it the center of world economic activity, and the U$D the currency of international trade.
The paradox is that although the US regularly changes governments every four or eight years, it is seen as more stable, more reliable, than any country that has had the same head of state for decade after decade. That is because while the US government may regularly swing between Democratic and Republican, or some mix of them, each successive administration has largely stood behind the deals and promises made by previous administrations. That's the real meaning of full faith and credit of the United States.
Like so many issues in dispute these day, "full faith and credit" is rooted in the US Constitution. The "Full Faith and Credit Clause" in Article IV, Section 1 mandates that each state respect the laws and governments of every other state. It has also been taken to mean each successive US administration will honor treaties, deals, and promises made by those that came before. US treasury bonds have become the "gold standard" of money reserves precisely because they are backed by the full faith and credit of the United States.
Donald Trump doesn't see a need to abide by the Constitution, let alone honor deals made by previous administrations, even if that previous administration was him—as in the case of the USMCA deal with Mexico and Canada.
And especially in his psychotic quest to rid the country of black and brown people, he has been willing to violate decades old norms on how the US government has treated immigrants. After all the lies about how "we just want people to come in the right way," he has been secretly ripping up their green cards, and ordering his masked thugs to kidnapped and imprison them with no due process.![]() |
Just hours before lifting tariffs he tells his followers to buy. |
Did he really think that the securities market would fail to notice that the "full faith and credit of the United States" isn't what it use to be? This could get really ugly.
Clay Claiborne
10 April 2025