Outgoing funds or money moving out of a country due to economic uncertainty is referred to as capital flight.

The United States economy is experiencing a significant shift, as the selling of U.S. bonds has led to a weakening of the dollar. This trend, known as capital flight, has seen investors swapping dollars for other currencies or commodities, such as gold.

Investors are drawn to safe-haven assets like gold due to a combination of factors. The recent capital outflow from the USA is primarily driven by political attacks on the Federal Reserve's independence, particularly former President Trump's attempt to remove Fed Governor Lisa Cook. This undermines confidence in U.S. monetary policy and financial stability.

Additionally, the U.S.'s structural budget deficits, inflationary pressures from deglobalization, and increased geopolitical tensions have contributed to this trend. The world is treating America like a developing country due to this capital flight, a phenomenon known as capital flight, where investors pull their money out of America entirely.

The selling of U.S. bonds by investors has caused the dollar to go down. This market volatility, triggered by Trump's tariff announcements and later partial walk-back, has led to Wall Street traders' bets blowing up. The effect of this asset dumping is overpowering the normal effect of tariffs, making it atypical for a trade war.

A trade war would typically strengthen a currency, not weaken it. However, this plunge in the dollar is not typical for a trade war. The yield on 10-year U.S. Treasury bonds has increased from 4% to about 4.5% since April 4, as when people sell a lot of U.S. bonds, the interest rate on those bonds, called the "yield", goes up.

The long-standing correlation between U.S. bond yields and the dollar has dramatically reversed since Trump announced his "liberation day" tariffs. Detailed explanations on this phenomenon can be found in articles by The Economist and Allie Canal.

The consequences for the U.S. economy could be dire if capital flight continues. As of now, the U.S. dollar is currently plunging, buying only 0.88 euros compared to 0.97 euros when Trump took office. It is a challenging time for the U.S. economy, and understanding the factors contributing to this shift is crucial for navigating the future.