Back from the brink / May 2025
Art of War Vs Art of the Deal.
Back on April 6th, I warned that Trump 2.0 was committing grave tactical errors. You can listen to that voice note here 🔻 — but here’s the core message I ended with:
“So if GDP for 25 remains muted, which it probably will, then your tax revenues will suffer your budget deficit will accelerate and you will have isolated yourself to almost everybody in the world…. we could be amidst a major policy error by Trump 2.0 and this could lead to a recession — now what do they do?
Will they suddenly pull back when they realise? Will they try to walk back slowly and change the rhetoric?”
We now see Trump walking back but with the USA’s reputational capital seriously bruised — with the Dollar and the Treasury market still feeling the pain.
Where do we go from here? And is Trump 2.0 forced to become like a second Biden term to survive? The MAGA plot thickens…