The Death of the Dollar Smile For decades, the dollar was the global life raft—rising in boom times on U.S. growth, and again in busts as the ultimate safe haven. Wall Street coined it the “dollar smile,” and it became gospel among risk managers and hedge funds alike. But the smile is gone now, replaced by a confused snarl that reflects the world’s shifting sentiment: the U.S. isn’t safe anymore. It’s the source of instability. On “risk-off” days—those fearful market moments when capital should have flooded into Treasuries and the greenback—we’re seeing the opposite. The dollar drops. Treasuries slump. Investors aren’t seeking shelter in America. They’re selling it. “Sell the USA”: The Message from Global Markets Philip Diehl, former U.S.…
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