...Exactly, decades of multilateral development torn to shreds by a stroke of a pen.
"I think these [tariffs] are going adversely affect us with respect to inflation, when it comes to growth, adversely affect productivity. There's an even bigger point...what does this do to our credibility around the world?" Former Secretary, US Department of the Treasury Robert E. Rubin https://x.com/unusual_whales/status/1898539483299189183
There are two very bad scenarios for risk assets to worry about. Not saying either is probable, but I always think of tails.
1) doomsday. foreigners dump all US assets. USD, stocks, bonds down.
2) baby boomers de-risk rapidly.
#2 is scary because they’d never return to buy https://x.com/DannyDayan5/status/1898386469460365785
....#2 is exactly the outcome what Team Trump is effectively driving towards - by downgrading the wealth effect. BUT #1 is the accidental outcome that they could end up with if they press on being antagonistic and pursuing their rent-seeking approach to get even.
....the world is not going to just sit and suck up all the sh*t Trump 2.0 wants to throw at them without a fight just because he proclaims that the world had been unduly unfair towards US and took advantage of them for decades.
....USA wasn't exactly doing charity, it wanted to establish itself as the leader of the free world and win support for democratic values (something which Trump obviously does not appreciate) and in turn it was able to be the reserve currency of the world, attract global capital and purchase of its US Treasuries so every American can spend more than they could produce.
