What to know about safe havens and the U.S., as the Netherlands' central bank follows France in pulling gold out of New York

President Trump's use of economic and military threats to advance his agenda aren't helping boost confidence in the U.S.

The U.S.'s status as a financial safe haven has begun to clash with President Trump's growing barrage of economic and military threats to advance his agenda.

The Netherlands' central bank cited "geopolitical unrest" this week in its decision to move gold out of New York. Norway's $2.4 trillion oil fund also floated a plan to cut its Treasury holdings and reduce its overall government-bond holdings to 50% from 70%, according to a spokesperson for the fund.

Trump's sweeping tariff fight shocked the world last year. Then came the capture in January of Venezuelan leader Nicolás Maduro, February's launch of the U.S.-Iran war, and plans in late August to control of more than 65 billion barrels of Venezuelan oil.

In between, there's been taunting of European and NATO allies, a campaign to takeover over Greenland and its natural resources and, lately, an escalating U.S.-Canada trade war.

So, does the world now trust the U.S. less?

"This is more about the irrationality of the president," said Steven Blitz, chief U.S. economist at GlobalData TS Lombard - pointing to Trump's threat on Friday to cut trade with certain countries unless the Federal Reserve slashes interest rates.

"Who's to say he can't suddenly decide that this gold [in New York] can't leave?" Blitz said of Trump. The odds of that occurring look unlikely, he noted, but central banks also aren't wrong to consider the possible risks - at least until there's more clarity on U.S. policy after Trump's second term ends in January 2029.

"In the meantime, is it prudent for the Dutch to move gold out? The answer is: Yeah, I can understand it," Blitz added.

Nations have long held gold as a reserve asset - using it as a source of safety, investment and as a hard asset that can be swapped for cash. They began stashing more reserves in the New York Fed's gold vault in the wake of WWII. France recently sold the last of its New York gold, while upgrading it and netting a gain equivalent to $15 billion. Germany made big transfers during Trump's first term in the White House.

"I see this as being more about control than geography," said Max Baecker, president of American Hartford Gold, a precious-metals dealer. "Central banks want to know they can access and mobilize their gold when they need it."

A White House official said America's post-WWII leadership, which led countries to deposit their gold at the New York Fed in the first place, remains secure under Trump.

Aside from gold, U.S. Treasurys have been another preferred asset class for central banks. Since central banks tend to be less sensitive to price swings than institutions or individual investors, steady hands in the market can increase an asset's appeal.

The U.S. has more than 8,000 metric tons of gold - making it the top holder, followed by Germany, France and Italy, according to the latest data from the World Gold Council. The Netherlands has closer to 1,300 tons, or about 55% of its total reserves.

The central-bank gold transfers follow a sharp jump in gold prices (GC00) since Russia's 2022 invasion of Ukraine. The precious metal hit a record of about $5,600 an ounce in January, up from around $2,000 four years ago, but lately has hovered around $4,477, according to FactSet.

"My advice on gold is there's not a lot of harm in having some, particularly if it helps you sleep at night," said Jim Baird, chief investment officer at Plante Moran Investment Advisors.

But Baird isn't recommend putting all your money in gold and "burying it in the backyard." Instead, the adage that Treasurys are the "best house in a bad neighborhood" still stands, despite the U.S. national debt reaching $40 trillion this summer, he noted.

"For all the problems we have, is there another market as deep or liquid? That answer is no," Baird said.

Concerns about the U.S. debt - as well as inflation caused by higher oil prices (CL00) (BRN00) stemming from the Iran war - are reasons for the benchmark 10-year Treasury yield's BX:TMUBMUSD10Y big jump to about 4.8% in September, from 4% in March after the start of the Middle East conflict.

If yields keep rising, bigger problems could arise - including if there's a lack of buyers for Treasurys amid eroding confidence in the U.S. and the Federal Reserve's ability to contain inflation.

"I would watch if it does break out to 5%, and it stays there beyond a week or two," said Stephanie Link, chief investment strategist at Hightower Advisors. "That's going to be an interesting tell."

Foreign holders already have played a smaller role in the Treasury market ever since their share in the market peaked at nearly 56% in the aftermath of the 2008 global financial crisis. Last year, it was closer to 31%.

"It used to be, when the markets moved too far, people started asking about buying Treasurys," said Bob Edwards, chief investment officer at Edwards Asset Management. Yet with inflation still a problem, he said he's now steering clients toward "boring" dividend stocks and suggesting they take some risk off the table after the big run-up in artificial-intelligence plays.

In recent years, the U.S. government has been running a very large deficit, and the reaction has been higher 10-year and 30-year BX:TMUBMUSD30Y Treasury yields, said Mike Treacy, vice president of risk at Apex Fintech Solutions.

"As long-term rates go higher, then there's going to be more demand for gold itself," he noted.

Yet any tarnish to the U.S.'s standing could be fleeting. "What may be true today could be very different, not just in two years, but in two months," Treacy said, pointing to November's midterm elections.

"Geopolitics are cyclical," he added.

Robert Schroeder contributed.

-Joy Wiltermuth