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Depending on one's point of view, Trump's policy U-turns are either a result of him playing chicken with the market for a week, before recognising that his multi-front trade war had become unsustainable economically, financially and politically. That at least, was the line that London's Financial Times took in this piece.
For those inside the circle, and the oval office itself, this was all part of the master plan, a giant game of cards or an extension of the reality TV show where he originally made his name. It's not like the Donald to readily admit he made a mistake (in fact, it would probably be a first), so he couched it in terms of helping those people who were, in his words, getting a little 'yippy" and "queasy".
No wonder.
Leaving aside the questions of market manipulation or insider trading, it's also not like the Donald to readily take advice from others. Maybe the comments from the likes of JP Morgan's Jamie Dimon: "the issues must be resolved quickly or it might be disastrous in the long run," or Bill Ackman's "self-imposed economic nuclear winter," or Ray Dalio's "the biggest disruption is yet to come," finally got through - if not to Trump himself, then maybe to others in his inner circle.
As the article in the FT continued, "just because the market breathed a collective sign (sic) of relief yesterday, it doesn't mean the trade uncertainty is gone. Indeed, it doesn't, or hadn't, with the ASX200 gyrating close to 200 points by lunchtime on Friday.
Only time will tell the outcome of Trump's upending of the world's economic order, but there aren't many economists or experts, outside insiders such as Scott Bessent and Peter Navarro, who believe he's on the right track. Even Elon Musk, who's coming to the end of his 120 day appointment as head of DOGE, isn't a fan of the tariffs. Or if it comes to that, of Navarro who he described as "a moron" and "dumber than a sack of bricks", in response to Navarro's reference to Musk as "a car assembler."
Now everyone (with the exception of China) has 90 days to plead their cause for favourable treatment. Meanwhile China is unlikely to do any such thing, as losing face is not acceptable.
For those calling on or expecting the RBA to panic and cut rates aggressively, Michele Bullock had some advice: "We are mindful of not adding to the uncertainty, and to that end, it's too early for us to determine what the path will be for interest rates. Our focus remains on our dual mandate for price stability and full employment."
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