Trump Warned as US Treasury Drops Financial Nuclear Bomb, US Debt May Collapse

The world’s largest futures exchange, CME, suddenly issued a warning because the U.S. Department of the Treasury personally intervened in oil prices, potentially triggering an “epic disaster.”

The U.S. Department of the Treasury, using American taxpayers’ money, directly intervened in commodity futures prices. Why does this cause dissatisfaction in Chicago? What risks could such actions by the U.S. Treasury pose to the financial markets?

Chicago Exchange Issues a Warning Signal

According to the Financial Times: On March 13, the CME Group, the world’s largest futures exchange operator, issued a stern warning to the Trump administration that if, during the US-Iran conflict, derivatives markets are manipulated to lower oil prices, it could cause an epic disaster in the financial markets.

The warning was prompted by the U.S. Treasury’s direct involvement in leveraged crude oil futures trading, where it placed large short positions over several days to curb rising oil prices.

At the same time, the Trump administration announced the release of strategic petroleum reserves, jointly suppressing oil prices. Under this extreme operation, the oil market experienced significant volatility, soaring to $120 before crashing sharply, with Brent crude dropping to a low of $81.

However, this suppression only had short-term effects. As global oil supply shortages persisted, oil prices surged again above $100.

It’s important to note that when a sovereign nation’s treasury directly intervenes, it is unprecedented in global financial history—like a referee stepping onto the field to play, breaking the natural market balance and pushing its own finances to the brink.

In other words, the U.S. Treasury, as an official institution, is using taxpayers’ money and leverage to gamble in the market. If it profits, fine; but if it loses, who will be responsible?

Even more concerning is the situation with U.S. Treasuries. Since the Strait of Hormuz blockade, U.S. debt prices have plummeted like a kite with a broken string, with the 30-year Treasury yield soaring to 4.9%, just a step away from market warning levels.

As yields rise, prices fall, meaning U.S. Treasuries are becoming less valuable, and investors are frantically selling off.

CME’s warning is not baseless. As the world’s largest futures exchange, it has seen many market crashes. Describing this as an “epic disaster” underscores the seriousness of the situation.

After all, markets fear government intervention the most. Once investors lose confidence, the consequences can be dire. The Solomon bond incident from years ago shows that market manipulation only leads to self-destruction.

This move is essentially drinking poison to quench thirst. Sovereign nations directly intervening in futures markets not only erodes global investor confidence in dollar assets but also accelerates the sell-off of U.S. debt.

It’s crucial to understand that U.S. Treasuries are considered a “safe haven” globally. If they destabilize, the entire global financial system could be affected. Instead of easing fiscal pressure, it might trigger a larger crisis.

More critically, the continuous decline in U.S. debt prices reduces the likelihood of the Federal Reserve cutting interest rates.

Initially, markets hoped the Fed would lower rates to ease economic pressure. Now, with yields high, rate cuts would only devalue the dollar and lead to more capital outflows.

CME’s “epic disaster” warning is not alarmist but a precise forecast of U.S. fiscal policy.

In recent years, the U.S. has been stuck in a path-dependent cycle of easing fiscal policy, with high debt levels no secret. As of March 2026, U.S. national debt exceeded $39 trillion.

The Treasury’s move to short crude oil appears to be an emergency response to price volatility but actually exposes structural economic contradictions—overreliance on debt and market manipulation, neglecting institutional reform.

The Fed’s “twist operations” in the past aimed to artificially lower long-term interest rates, but resulted in a decade-long stagflation. The lessons are still fresh, yet the U.S. seems to be repeating the same mistakes.

In the long run, the crisis in U.S. debt will not ease easily. Instead, it will worsen due to expanding fiscal deficits and eroding market confidence.

For the global economy, reducing dependence on the dollar and U.S. debt, and promoting a multi-currency system, are prudent strategies to address this crisis.

Author’s note: Personal opinion, for reference only.