Tariffs – Canadian Prime Minister Mark Carney thinks & works cooperatively. Donald Trump focuses on getting others to “kiss my ass.” Alongside allies in Japan and the European Union (EU), Carney used a calculated financial strategy to force Trump to back down from imposing tariffs by leveraging U.S. Treasury bonds. Two updates since publication. I will update when I learn more.
How Carney Got a Bully to Back Down
Canada quietly increased its holdings of U.S. Treasury bonds to $350 billion by early 2025, part of the $8.53 trillion held globally.
Carney coordinated with Japan (which holds over $1 trillion in U.S. debt) and EU nations (which hold $1.5 trillion combined) to signal a potential slow-bleed sell-off of these bonds if Trump escalated tariffs.
A gradual sell-off would destabilize the U.S. economy by increasing borrowing costs, weakening the dollar, and potentially triggering a depression.
Tariffs Paused
Trump announced a “pause” on tariffs for Canada, Japan, and the EU while maintaining high tariffs on China. Meanwhile, Canada maintained its retaliatory tariffs and delayed further negotiations until after its April 28 election. Thanks to Nell Minow
for pointing out Dean Blundell‘s Substack and Carney’s Checkmate: How Canada’s Quiet Bond Play Forced Trump to Drop Tariffs. I note in closing that China holds $1.1 trillion in Treasuries.
Relevance to Corporate Governance
This development offers lessons in corporate governance. Polite engagement seeking mutually beneficial benefits often works better for all parties than macho bravado. Once again, it also makes me thankful to be a dual-citizen, brought up by Canadian parents from Saskatchewan.
Moose Jaw and Unity, Saskatchewan, existed in a different world from Pittsburgh, which had the third highest number of corporate headquarters when I was young. Saskatchewan had cooperative grocers, gas stations, wheat pools, banks, credit unions, housing, and other cooperatives. When I headed California’s Cooperative Development Program, I turned to the University of Saskatchewan for help and educational materials. Lessons learned helped me reach agreements or “win” on 62% of my stockholder proposals last year.
Update 1: No, Mark Carney Didn’t Sell Off U.S. Treasuries To Ambush Trump. He Sold Credibility
Mark Carney
According to Matthew Dufresne,
What actually happened is more sophisticated—and more effective. Mark Carney didn’t need to weaponize financial markets. He brought disciplined diplomacy, coordinated pressure, and the backing of key allies… He wasn’t threatening Trump. He was boxing him in with credibility, not chaos. So no—this wasn’t a Treasury bond ambush. It was diplomacy done right. Quiet. Strategic. And impossible to ignore. And for that we should give Carney full marks.
Update 2 Snopes: Unpacking Claims
The allegations stemmed from a newsletter installment by Dean Blundell, a Canadian former radio personality who media outlets like the Toronto Star have described as a “shock jock” — a radio presenter who relies on offensive words and exaggeration to build a listenership. Blundell’s former radio station CFNY-FM (102.1 The Edge) suspended him in 2013 after one controversy too many. He then joined CJCL (SportsNet 590 The Fan), a sports radio station, until the station dropped his show in 2017. He has since hosted an independent podcast and launched a newsletter on Substack… When Snopes reached out to Blundell, we also asked what he meant when he said Canada was “off the hit list,” alongside Japan and the EU. We will update this report should he respond.
I recommend readers interested in this storey check in with Snopes for updates. Although we may have been snookered, so far it seems likely that Carney also snookered Trump through quiet diplomacy.
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