What happened with the National Guard on January 1?

President Trump said National Guard deployments in Chicago, Los Angeles, and Portland will end, citing lower crime and a readiness to redeploy if violence rises. This policy shift places more responsibility on local policing and budgets. It also sets a new baseline for judging urban risk in Q1 2026.

How could this affect US municipal bonds held in Japan?

If investors see higher risk in large cities, credit spreads can widen and issuance could slow. That may pressure USD returns even with JPY hedges. If safety holds, spreads can stabilize. Focus on fund liquidity, state-level diversification, and the Trump National Guard withdrawl as a potential policy overhang.

Which indicators should I track in early Q1 2026?

Monitor weekly crime levels from city dashboards, police staffing, and response times. Follow council budget actions, insurance commentary on claims, and muni fund flows. Rating outlook changes and primary market activity can confirm sentiment shifts before earnings season for major urban retailers and property owners.

How should I adjust currency hedges around this news?

Match hedge ratios to the income goal and risk budget. For stable cash flows, keep higher JPY hedges and ladder maturities. For tactical buys, use lighter hedges and stop-loss rules. Review hedge costs versus expected spreads, and revisit positioning if a redeployment signal shifts risk pricing.

Law and Government

January 1: Trump Pulls National Guard From Chicago, LA, Portland

ByHuzaifa Zahoor January 1, 2026January 1, 2026

Trump National Guard withdrawl on January 1 covers Chicago, Los Angeles, and Portland. The White House cites lower crime and warns of redeployment if violence returns. For Japan-based investors, this move may shift perceived risk in US cities. We see possible changes in municipal budgets, insurance pricing, and urban retail and property trends. Portfolio impact depends on crime data in early Q1 2026, policy responses by mayors, and market pricing in USD assets held with JPY hedges.