Global (dis)order

Two seismic shifts are rewriting the global order this week, and they have more in common than meets the eye. First, the Canada-U.S. Trade Rupture: yesterday, trade talks between the U.S. and Canada collapsed. The U.S. imposed 50% tariffs on ~$20 billion of Canadian goods, and Prime Minister Mark Carney immediately announced dollar-for-dollar retaliation. Carney called the last-minute U.S. demands "uneconomic, unfair, and undermined the net benefits for Canada." Second, The Middle East Base Exodus: Iranian strikes during the 2026 conflict damaged or destroyed at least 228 assets across 15 U.S. bases in 8 countries. Gulf states reportedly blocked U.S. base and airspace access during the escalation. Now CENTCOM is reportedly considering relocating bases from Bahrain, Kuwait, and Saudi Arabia to Israel. And into this vacuum? China is stepping in, positioning itself as the region's next security guarantor through arms deals, joint military exercises, Belt and Road infrastructure, and deepening ties with Egypt and Iran. Third, the Treasury Market Blind Spot: The U.S. is fighting with its creditors. In March 2026 alone, foreign holders dumped $138.4 billion in U.S. Treasuries. Japan led the exit selling $47.7 billion. China sold $41 billion. Saudi Arabia sold $10.8 billion. Canada sold $6.9 billion. The UAE sold $5.8 billion. Let that sink in. The U.S. just imposed 50% tariffs on Canada — which holds $460 billion in U.S. Treasuries. The U.S. is losing military access in the Gulf, where Saudi Arabia holds $142.5 billion and the UAE holds $114.8 billion in U.S. debt. And the U.S. is in a full-blown trade war with China, which still holds $633 billion in Treasuries, down from a peak of $1.3 trillion in 2013.

The dollar index has already fallen from 113 in October 2022 to 99 today. The bottom line: The post-WWII American-led order is unraveling at the edges, and now the bill is coming due in the Treasury market.

Allies like Canada are being treated as adversaries in trade. Partners in the Gulf are hedging their bets on security. China is filling the vacuum with economic and military diplomacy. And all three are quietly, or not so quietly, reducing their exposure to U.S. debt.

This isn't just geopolitics. The implications for business are enormous: (1) Supply chains built on U.S.-Canada integration now face 50% tariff walls, (2) Energy and defense contracts in the Middle East are being redrawn, (3) Treasury yields will face upward pressure as foreign demand wanes, (4) The dollar's reserve status is being tested in real time, and consequently, companies must now navigate a multipolar world where "U.S. ally" no longer guarantees market access, security, or stable financing costs. The question isn't whether the world is changing. It's whether we're building strategies for the world that is, or the one that was.

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