Trump Era 2025-2029 : Stock and Economic Comment

[waterbottle]

The end and most likely replacement of the Bretton woods system

With what though?

 

[Craton]

Found this on YT from CBC/Andrew Chang.
His final comment on how the US of A tariff's where calculated sums it all up, "I don't know what logic explains that."

The bizarre way Trump’s team calculated reciprocal tariffs​

 

[basilio]

So for a second day markets around the world are crashing. (Trump reckons the stock market will BOOM!! Perhaps it will .)

I wonder how secure/stable the financial institutions are at the moment? One of the points I noted yesterday was an observation from Deutsche Bank. I don't believe today's gyrations have helped.

We know from experience that if one bank fails the knock on effects across the whole financial system are very real.

Deutsche Bank says risk of a dollar confidence crisis​

By Reuters
April 3, 20259:07 PM GMT+11Updated 19 hours ago


LONDON, April 3 (Reuters) - Deutsche Bank warned on Thursday of the risk of a crisis of confidence in the U.S. dollar, saying major shifts in capital flow allocations could take over from currency fundamentals and currency moves become disorderly.

The dollar, the world's No.1 reserve currency, came under broad-based selling pressure on Thursday as U.S. President Donald Trump's latest tariff salvo raised concerns about U.S. recession risks.

The Reuters Tariff Watch newsletter is your daily guide to the latest global trade and tariff news. Sign up here.

"Our overall message is that there is a risk that major shifts in capital flow allocations take over from currency fundamentals and that FX moves become disorderly," Deutsche Bank's George Saravelos said in note.

He added an acceleration in the dollar's decline would be unwelcome for global central banks.
"The last thing the ECB wants is an externally imposed disinflationary shock from a loss in dollar confidence and a sharp appreciation in the euro on top of tariffs," he said, referring to the European Central Bank.

"Expect pushback. We are in the midst of dramatic regime change in markets."
The dollar was last down over 1.5% against the euro and yen and more than 1% against sterling. ,

https://www.reuters.com/markets/currencies/deutsche-bank-says-risk-dollar-confidence-crisis-2025-04-03/

https://www.bloomberg.com/news/features/2025-03-30/wall-street-fears-liquidity-problems-creeping-back-into-currency-market

 

[basilio]

RBA overview of the resilience of the Australian Financial system.
Interesting to see the comments on the failure of the CHESS system in December last year. They wern't impressed.

Resilience of the Australian Financial System | Financial Stability Review – April 2025

Resilience of the Australian Financial System | Financial Stability Review – April 2025

www.rba.gov.au

 

[Garpal Gumnut]

Thanks @basilio . Those thoughts on the $USD went through my mind today. The US deficit is huge and should foreign governments sell their US Treasuries the depreciation in the $USD will accelerate. The rise in gold has mirrored the loss of faith in the $USD as a default currency.

The further DOGE business will strip the public service of it's best minds in the Treasury Department via resignations, further diminishing the ability of the US to respond to China's push to increase the stature of the yuan. Russia, Argentina, Persia, Brazil and Bangladesh are using more yuan to finalise big purchases and projects.

gg

 

[divs4ever]

Thanks @basilio . Those thoughts on the $USD went through my mind today. The US deficit is huge and should foreign governments sell their US Treasuries the depreciation in the $USD will accelerate. The rise in gold has mirrored the loss of faith in the $USD as a default currency.

The further DOGE business will strip the public service of it's best minds in the Treasury Department via resignations, further diminishing the ability of the US to respond to China's push to increase the stature of the yuan. Russia, Argentina, Persia, Brazil and Bangladesh are using more yuan to finalise big purchases and projects.

gg

i was thinking more along the lines of

if those international exporters sell less into the US ( and/or in US dollars ) who is going to buy all the new treasuries created to service the ballooning debt ( when receipts are struggling to service the current bonds/notes/bills )

and that assumes nearly all current bonds holders will roll over into new bonds ( and they don't have to pay out much cash )

 

[basilio]

i was thinking more along the lines of

if those international exporters sell less into the US ( and/or in US dollars ) who is going to buy all the new treasuries created to service the ballooning debt ( when receipts are struggling to service the current bonds/notes/bills )

and that assumes nearly all current bonds holders will roll over into new bonds ( and they don't have to pay out much cash )

I agree divs. That is indeed a longer term issue.
In the shorter term however the crashing markets and the realisation that the US is no longer capable of being a Free World leader could undermine the dollar as well.

I was alluding to possible financial collapses of institutions who end up on the wrong side of big dollar trades.

The question of how a collapse in the dollar could occur has exercised minds. No one wants to be last out of the room.

What It Would Take for the U.S. Dollar to Collapse

Investors at times have concerns about the dollar’s vulnerability, but a review of the dollar’s strengths and weaknesses suggests that a currency crisis is unlikely.

www.investopedia.com

 

[basilio]

This is also the worst possible time for a cyber attack on the international financial systems.

Stock Markets. Banks. Settlement systems. Anything associated with the Government.

 

[basilio]

In terms of Trading Patterns/strategies on the various exchanges, Forex Markets, Derivatives etc.

How would AI platforms respond to the current situation ? The inputs are completely outside any experience they have been given. The worlds biggest Trading Nation starting a trade war with everyone else. The impacts on trade, industrial production being massive but outside any historical record (except perhaps 1930 Smoot - Hawley Tariffs ?)

Just wondering how these platforms will respond and if they go on automatic.

Anyone know more about this possibility ?

Smoot–Hawley Tariff Act - Wikipedia

en.wikipedia.org

 

[divs4ever]

I was alluding to possible financial collapses of institutions who end up on the wrong side of big dollar trades.

i was trying to skip over that ... just like the media is

what i was pondering was , the Yen carry-trade is this part B ( and the rest of the alphabet rushing to catch up ) ?

there are ( allegedly ) a LOT of leveraged bonds out there ( UK , Japanese and US and goodness knows who else )

would Governments bailout hedge-funds and pension funds this time , or will it be timely cyber-attacks

this could be terribly messy ( shredded derivatives everywhere )

 

[divs4ever]

In terms of Trading Patterns/strategies on the various exchanges, Forex Markets, Derivatives etc.

How would AI platforms respond to the current situation ? The inputs are completely outside any experience they have been given. The worlds biggest Trading Nation starting a trade war with everyone else. The impacts on trade, industrial production being massive but outside any historical record (except perhaps 1930 Smoot - Hawley Tariffs ?)

Just wondering how these platforms will respond and if they go on automatic.

Anyone know more about this possibility ?

Smoot–Hawley Tariff Act - Wikipedia

en.wikipedia.org

in my experience ... no

but having played with computers ( as a hobby ) epic , and jaw-dropping come to mind

possibility one it does nothing ( just like many humans ) either waiting for better data or stuck in indecision , assuming faulty data .

possibility two it assumes the new data is correct and runs with it and may think it is a new mid-term trend ( say a 10% plus ) drop over the next week , maybe it would ( naked ) short or sell rapidly

less likely would it think like a value trader and selectively buy the dip

but i guess we will learn together ( when the truth leaks out 7 or 8 years later )

maybe we should ask Jack Ma's new AI it is capable of side-projects when processing an answer ( and this looks complicated )

 

[Garpal Gumnut]

In terms of Trading Patterns/strategies on the various exchanges, Forex Markets, Derivatives etc.

How would AI platforms respond to the current situation ? The inputs are completely outside any experience they have been given. The worlds biggest Trading Nation starting a trade war with everyone else. The impacts on trade, industrial production being massive but outside any historical record (except perhaps 1930 Smoot - Hawley Tariffs ?)

Just wondering how these platforms will respond and if they go on automatic.

Anyone know more about this possibility ?

Smoot–Hawley Tariff Act - Wikipedia

en.wikipedia.org

I try not to worry over matters out of my control. Just matters within my control. As in buy/sell. If there is a major breakdown in the mechanics of trade and investment it is totally out of my control so it doesn't bother me unless it actually happens. Should it happen, my major decision will then be to have a toasted cheese sanger or a bowl of Weetbix with yoghurt, raspberries and full cream Jersey milk. .

gg

 

[Smurf1976]

I've said this before, how fast is the US going to be able to ramp up their own manufacturing again?

On the physical work side the bottleneck is likely to be with infrastructure.

How long it takes to build a factory depends on what it's producing but generically, the average factory can be built somewhat faster than the average power station, railway, transmission line or dam.

Because the supporting infrastructure tends to be a lot more fussy on the detail and the construction is far more weather dependent. The factory's one site with some buildings on it and once they're up then the rest of the work's indoors installing machinery and the like.

Versus the transmission line or railway that involves 50 different land owners, considerable regulatory oversight, requires some proper engineering work to be done and the whole thing's built outside in what are typically highly exposed to weather locations eg an open field.

Some exceptions of course, some factories are essentially outside (eg oil refineries) and highly complex but they're more towards the infrastructure side than what most would regard as manufacturing as such.

Put that all together and building the factory is one thing. Getting the raw materials in, the goods out and having the power, water and other inputs to run it is the more likely bottleneck overall.

 

[divs4ever]

On the physical work side the bottleneck is likely to be with infrastructure.

How long it takes to build a factory depends on what it's producing but generically, the average factory can be built somewhat faster than the average power station, railway, transmission line or dam.

Because the supporting infrastructure tends to be a lot more fussy on the detail and the construction is far more weather dependent. The factory's one site with some buildings on it and once they're up then the rest of the work's indoors installing machinery and the like.

Versus the transmission line or railway that involves 50 different land owners, considerable regulatory oversight, requires some proper engineering work to be done and the whole thing's built outside in what are typically highly exposed to weather locations eg an open field.

Some exceptions of course, some factories are essentially outside (eg oil refineries) and highly complex but they're more towards the infrastructure side than what most would regard as manufacturing as such.

Put that all together and building the factory is one thing. Getting the raw materials in, the goods out and having the power, water and other inputs to run it is the more likely bottleneck overall.

and then you have the machinery ( used in the plant ) find/educate the staff/robots

it will take all of 4 years to see a massive improvement overall ( if China doesn't stop vital exports .. if so you have to dig mines , make processing plant , roads/trucks etc )

 

[Gunnerguy]

I've done staggered buy orders in increments of 15.

525, 510, 495, 480, 465, 450. Amounts increasing each time to keep my average buy price chasing the actual market price.

Why not sell puts at these prices instead. You still get the share if it hits the price and some extra cash. You get the put cash from the ones that arn’t hit

 

[Knobby22]

Found this on YT from CBC/Andrew Chang.
His final comment on how the US of A tariff's where calculated sums it all up, "I don't know what logic explains that."

The bizarre way Trump’s team calculated reciprocal tariffs​

Unreal!

 

[IFocus]

Wonder what / when supply chains start to collapse or unwind and what / how the financial underpinnings become insolvent as an effect could be messy should it get a run on someone will have to go belly up some where as a result

Credit markets may give a warning

 

[Dona Ferentes]

Credit markets may give a warning

High yield US corporate bonds

 

[Sean K]

Italy leading the way in Europe. Looks like the Trump Dump has another day or so in it.

ASX200 after hours...

 

[Knobby22]

Italy leading the way in Europe. Looks like the Trump Dump has another day or so in it.

ASX200 after hours...

View attachment 196819

My pick of 7600 wasn't lightly taken. You mentioned an article that led you to 5000, I know somewhat jokingly but still.
We haven't seen capitulation yet.

And this is how the Great Depression started. It could still be avoided easily but at present...


Worst case scenario, Europe, UK, Canada, Japan etc. do tariffs of their own to punish, USA doubles up.