The ghost of the Day of Resurrection is still waving on the horizon

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Your guide to what the second period of Trump means to Washington, business and the world

In 2019, I wrote a column about the coming “The Resurrection Day scenario in dollars” Where the basic shift in globalization and the postton Woods system leads to a decrease in both the value of American assets and the dollar. This would raise bond returns, as well as the price of gold and different foreign currencies.

Here we are. S&P may rise and is on President Donald Trump’s daily mood swings, but the template was thrown for a new era.

Although I was never great in predicting the timing of big market bouts-as a child for immigrants, I tend to cancel the risks very early-I have a strong global look. I adhere to the idea that the entire model for investment is changing, and that rebalancing away from the American market is important. This will be the case with or without a commercial war.

Even if Kamala Harris is in office today, we will be in the world of consensus after Washington (the White House said very much). We were also heading, albeit more slower than we are now, to a multi -polar world in which the origins of dollars and dollars are no longer the only game in the city.

A few large investment stories stuck to more than a decade, and the United States was at the forefront much longer. The financial and concentrated financial model that is moved by debts and which is placed there is exploited in ways that go beyond Trump and its strange.

I would like to refer to three basic issues, from excessive dependence on economic -based economic growth. Almost all major American economic decisions in the last century were related to the enhancement of asset prices-starting to cancel the organization of interest rates in the late 1970s to codify the shares re-purchases to the “performance performance” that was unloaded in the shares, creating the huge wealth of paper in Silicon Valley.

Trump and his assistants talk about how the main street does not care about stock prices. But the fact that the growth of asset prices has greatly exceeded the growth of income means that we all depend on capital markets.

Exposure to American families of stocks is located near its highest levels (stocks and mutual investment funds represent 26 percent of the total household assets), which means a much larger security vulnerability for any stagnation in the market, for both individuals and macroeconomics.

Keep in mind that since 1995, “shares have become the marginal driver for US federal tax receipts,” according to a presentation by Luke Gromen. “If the stocks drop beyond that, spending on consumers in the United States and GDP will go to stagnation, which sends a deficit up to the top,” he writes. This will come at a time when inflation will remain a source of anxiety and risk that investors are calling for high American assets.

Definitions or not, most analysts believe that there is a correction of larger stock prices in the United States. American stocks are still exaggerated in relation to their peers. The financial stability report in the International Monetary Fund has made this sign as a great danger to global markets.

I have a great concern about the American markets is the sharp increase in private sector debts and leverage over the past few years. Borrowing has flourished from private credit markets, especially from companies that would have been a great risk for bank loans.

Many private credit funds that lend have merit dates, and this means a period that can no longer revolve around loans, which will come from now until 2027.

Lee Corriere Fryer, the former Supreme Council of Education Adviser on Financial Stability and the Director now to protect investors in the American Consumer Union.

This may eventually lead to no failure of the bank shade but the problems in the official banking sector, which is much more exposed to non -banking entities than it was in 2008, when the global financial crisis erupted.

The last point to include the introduction of additional risks into the American financial system in the form of an encrypted currency, while the Trump administration took a relaxing position towards organizational enforcement, and employees actively reduced the Securities and Stock Exchange Committee and took over the consumer financial protection office.

Republicans and Democrats alike have supported the law of the genius, which will open the flood gates to use encryption in the real economy, which may inflate the risks above.

The Biden government was already forced to support the coding platform circle when Silicon Valley failed. The new legislation, which recently approved preliminary obstacles in both the Senate and the House of Representatives, will encourage more official and informal players to enter Crypto, which is of course a field for President Trump and ELON MUSK Interest in.

I do not necessarily expect that the debts of companies or the liquidity crisis that is adopted by encryption will descend the American economy-although I will not be surprised if the next financial crisis comes from those areas. Instead, my point is that you do not have to believe that the trade war is imminent to see that the American asset markets are increasingly fraught and still exaggerated. Add to this the confidence in the confidence created by Trump, and I say that the International Day of Resurrection scenario still has an operating room.

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