What Me Worry? Markets Face a Rendezvous With Reality
Investors have so far shrugged off the administration’s shambolic tariff wars, profligate fiscal policies and assaults on the central bank. Good luck with that.
The truth is out there, somewhere.
Photographer: Spencer Platt/Getty Images North AmericaDevotees of MAGA economics and old-school Washington Consensus types seem to agree on one thing: President Donald Trump is driving the most ambitious and far-reaching shift in economic policy for decades. Yet investors, up to now, have greeted these efforts with a collective shrug. Are financial markets merely hedging their bets — splitting the difference between “A golden age is dawning” and “We’re doomed” — or do they think the current economic-policy upheaval is mere sound and fury signifying nothing?
Maybe all of the above. Golden age? Tax cuts will unleash a new phase of “parallel prosperity,” as Treasury Secretary Scott Bessent puts it. Financial collapse? For sure, fiscal policy is unsustainable and the Federal Reserve is about to be crippled. Hedge your bets? Makes sense: Boom or bust, it’s a coin toss. Nothing to see here, move along? Obviously: Discount the Trump euphoria and Trump derangement, it’s business as usual.