Tomorrow on June 24, the NATO summit will start with a dinner & conclude with a minimal session on June 25.
All fear that Trump will declare that he loves Putin - his kleptocracy, autocracy & imperialism. Yes, Trump is awful. State that! /1 Next, the ideologically real NATO members are afraid that Trump will attack Ukraine, while the whole purpose of NATO is to stand up to Russia and defend free democracies, but Trump hates democracies and freedom. /2

Trump's economic policy:
1. Wild protectionism = less growth & investment.
2. Changed policy every day = complete uncertainty.
3. Undermining the rule of law & property rights.
4. Driving foreign investors & nationals out of the US.
5. Hindering profitable immigration.
/1 6. Minimizing government support to research.
7. Harming the best US universities.
8. Risking fiscal unsustainability.
9. Harming the poor to cut taxes for billionaires.
10. Blatant personal corruption.
Trump stands for an economic disaster like 1929.
/2

A few thoughts on Russia's war against Ukraine:
1. Trump does whatever he can to support Putin. His problem is that most republicans support Ukraine, so he gives them an opportunity to cheat themselves to claim that Trump supports Ukraine. /1 2. Consequently, Trump always finds a reason not to increase sanctions on Russia. Yet, the republican opinion compels him not to ease the existing sanctions.
Conclusion: Shame the hypocrite Trump so that he does not dare to turn fully against Ukraine! /2

My understanding of the Trump-Musk conflict:
1. Musk considers that he bought Trump's presidency & that Trump should behave as his obedient servant.
2. Trump acknowledges that Musk bought him & allowed dozens of regulatory concerns to lapse & $20 billion of gov contracts. /1 3. Neither could care less about any social safety net for the poor.
4. Both wanted to minimize taxes for billionaires at the expense of the poor.
5. Musk wants to punish the poor even more than Trump to reduce the budget deficit. /2

It is frustrating to read most American comments on Trump.
They tend to think that Trump is a serious president favoring the US. Instead, they should take the lunacy he utters seriously.
At best, Trump pursues his own PR, but more likely it is just lunacy. /1 Trump has made plain that most of all he is interested in enriching himself & his family.
South African President Cyril Ramaphosa caught the essence: “I'm sorry we don't have a plane to give you.” Incredibly, Trump responded: “I wish you did. I'd take it.” /2

Trump insists on being the dumbest & most uninformed US president ever, causing the US tremendous damage, while enriching himself through dubious deals. What Trump has got wrong:
1. He claims that everybody has "ripped the US off," but the US GDP is 25% of global GDP as in 1980. 2. The US has thrived on the "exorbitant privilege" of foreigners investing $31 trillion (June 2024) in US bonds & stocks. The US is the greatest debtor in the world with a public debt of $36 trillion, $29 trillion in US treasuries.
If Trump was honest, he would thank.

Musk's so-called Department of Government Efficiency has caused tremendous damage to the US government & virtually nothing good:
1. By and large, it has operated against the law leading to hundreds of suits & no sustainable positive effects. /1 2. What one would have hoped that software engineers would have done is badly-needed digitization & simplification of government services, but apparently they have done none. /2

Everything is wrong with Trump's economic policies. Today, the US has the most incompetent economic policymaking of any developed economy & most emerging economies.
1. The prime US economic problem is an excessive public debt of 120% of GDP & budget deficits of 6.5% of GDP... /1 ...The obvious cure is to force the wealthy Americans & their companies to pay taxes - many of them pay nothing. The US public expenditures are tiny by international comparison. /2

In the last two weeks, US markets of all kinds have recovered.
I think this is a big mistake. Trump's tariff policy remains mad & enormously harmful to the US & the world.
He has still quadrupled US income tariffs & made the US the enemy of the whole world. /1 As everybody points out, Trump is unable to accept truth, to apologize or to retreat. Therefore, the US/Trump disaster is set to continue as long as he rules.
The GOP congressmen could stop it, but they are too cowardly.
The US billionaires are even more dastardly (cf Bezos) /2

Let me state the obvious again:
Nobody has ripped the US off as Trump so mendaciously claims.
On the contrary, the US has benefitted from an exorbitant privilege, that his predecessors & sound US institutions have imbued trust in the US $ & US treasuries. /1 Therefore foreigners held $30,881 billion of US securities on June 30, 2024, while the US GDP was merely $28 trillion. Of this $7.1 trillion was foreign holdings of US treasuries, of which $3,557 billion was held by foreign governments. /2
…ticdata.treasury.gov/resource-cente…

Increasingly, the American public (save Navarro & Lutnick) realize that Trump's high & unjustified tariffs are qualified madness.
Tariffs are taxes paid by Americans.
But they are not decided by Congress (which they should be).
They disrupt trade & may cause shortages. /1 Tariffs boost US prices.
Trump's capricious tariff policy has disrupted all confidence in the US economy & US assets.
Trump has made it unwise or worse to invest in the US.
At the same time, Trump undermines the fundamental rule of law in the US. /2

If it were not so tragic, the Trump destruction of the US economy would be comical.
Trump wants to go back to William McKinley's harmful tariff of 1890. He wanted to raise US tariffs from 2.5% to 28%.
Trump wants to tariffs to be the main tax, but just 1% of GDP. /1 Supplies to the US are plummeting: from China down by 30% in May.
Foreign companies - Subaru & Nissan - are closing factories in the US.
Other foreign companies are stopping deliveries to the US.
The big blow will be that uncertainty & chaos make the US UNINVESTIBLE. /2

Rarely has a financial crisis been so easy to predict, because it is caused by the US president:
1. Tariffs drastically reduce shipping to the US.
2. Complete uncertainty minimizes investment in the US.
3. The world seeing US madness sells $,
4. & sells US treasuries. /1 This scenario is obvious to anybody who has dealt with emerging economies crisis.
The US economic problems are political, an almighty president, who is as aggressive as ignorant, & his insistence of being surrounded by obedient servants who dare not tell him the truth. /2

The US stock markets have had a good week because Bessent dominated over Lutnick & Navarro at the IMF/World Bank spring meetings, but "S&P 500 remains significantly overpriced."
1. US exceptionalism is gone.
ft.com/content/4aa1d7… ...There is no longer any reason to price US stocks more than European stocks. The US tariffs will hurt US companies the most & probably the Magnificent 7 hi-tech companies most of all. Their earnings will moderate sharply. /2

Trump refuses to understand that the US is not being "ripped off," but on the contrary has been subject to an exorbitant privilege: Foreigners wanted to invest their financial assets in the US. This was the US exceptionalism. US stocks were valued at 2/3 more than EU stocks. /1 EU stocks have typically had a price per earnings (pe) of 15 (decent), while the US in the wonderful Biden era reached a pe of 25.
Now Trump has broken that, so far US pe has fallen to 22.
@FT suggests it might fall to 11.
Thus the US stock market could fall by half. /2

Trump is so pathetic in all his fury.
He thought he could subdue the whole world with his tariffs.
But the whole world realized 3 things:
1. These tariffs were bizarre.
2. They were arbitrary & unstable.
3. Most of all they harmed the US. ./1 All understood that you don't negotiate with an unbalanced man in fury.
Trump reinforced their understanding by being unable to state what was wrong & had to be changed.
Trump now calls on all to make deals early, clarifying that he knows he has proven himself a fool. ./2

After having appeared intimidating to the world, the Trump economic policy looks increasingly intimidating to the US (America First!?).
In January, the GDP expectation was a growth of 2.5-3%.
No Trump has slashed it to 0 or worse. /1 Trump's economic policy has many peculiar features:
1. It is based entirely on lies: The whole world has "ripped off" the US; No, the US has benefited from financing from the whole world. It had better say "thank you!"

I suspect that we are now in a 1929 moment.
The US economy is larger than ever - 1/4 of global GDP, as in 1980.
US stocks accounted for 70% of global stock market capitalization before madman Trump became president.
US price per equity was 25 & EU merely 15. /1 Now Trump will kill it all.
The US$ has already fallen by 10% in 40 days.
Why would US stocks be 70% of all stock markets and not a more normal 40%?
That would take US pe to the EU pe of 15.
Trump can cause so much damage to Americans.

A few observations on the US economy under Trump.
1. So far, Trump has complete control without any checks.
2. Trump wants to shock everyone by going far in arbitrary decision making, preferably tariffs which he himself decides.
3. Trump wants to dominate the news every day. 4. Trump does not care about what happens to the US, only cares about his own finances.
5. He has selected sycophants as top officials & controls the Congress & SCOTUS.
6. He could not care less about public debt or budget deficit.

Martin Wolf, FT, on Trump's disastrous policies:
"The proposed tariffs are proportional to the bilateral trade deficit divided by bilateral imports. The implicit assumption is that, in a fair world, trade would balance with every single partner. This is utter lunacy."
ft.com/content/d96d4a… "Yet tariffs will not close trade deficits...The deficits, determined by income and spending, will remain roughly unchanged. The world will just end up poorer. As Germany’s Kiel Institute argues, the biggest negative effects are likely to fall on the US: protection is usually an own goal."

We must not overestimate the primitiveness of Donald Trump and his trade policy. This man grew up in the corrupt New York real estate mafia world and was mentored by Roy Cohn, who was the chief lawyer of Italian mafia families in New York. Cohn taught Trum three principles: Attack! Deny! Never accept defeat but declare victory! Trump expresses his admiration for the otherwise not widely appreciated US president William McKinley, who introduced his high tariffs in 1890 as congressman and expanded the US territories with Puerto Rico, Guam, the Philippines and Hawaii. His ear was that of the robber barons, with no income tax. The tiny federal government was financed by tariffs. /2