Shogun Trump Closes The Country To Trade: A Silver Lining?

Summary

• Donald Trump’s attempt to reindustrialise America via tariff barriers cannot succeed on any realistic timespan.
• He will either change tack rapidly or face dissent from non-MAGA Republicans and, more significantly, Wall Street and Silicon Valley – powerful groups which backed his candidacy in the autumn. Elon Musk’s position, once out of government, should be interesting.
• Trump wants a weaker dollar and will probably get one.
• The geopolitical implications are horrendous. As things stand, Trump is handing East Asia to China on a plate.
• As with Covid and the Lehman shocks, the worse the financial carnage, the stronger the rebound as the authorities offer to do “whatever it takes”.
• A near-death experience for the global trading system could catalyse an awareness of mutual benefit and lead to renewed efforts to eliminate barriers.