Bloomberg Opinion

China Won’t Blink First in Its Fight With the US In my latest column, I explore why Beijing is unlikely to back down first in its escalating trade war with Washington. Both nations are entrenched in a high-stakes standoff. China’s diversified trade partnerships and political system suggest it can endure prolonged tensions. Meanwhile, American consumers face rising costs on essential goods, and global markets are feeling the strain. Read the full piece here: https://lnkd.in/gp_3fkGJ #TradeWar #USChinaRelations #GlobalEconomy #Tariffs #Geopolitics

Wall Street's role in convincing President Trump to pause higher tariffs on dozens of countries is resetting the prevailing view in corporate America about how best to influence the president. To be clear, none of what follows is anything close to an ideal way for the business community to engage with a US president. But that being said, here’s what I see working: 1️⃣ Admit when you’re wrong — and speak up. CEOs have, for the most part, been unwilling to speak out against Trump on practically any issue, fearing retribution. In this case, finance execs had to both publicly break with the president on tariffs, as well as eat some crow about their previous dismissiveness over the impact tariffs might have. 2️⃣ But tread carefully and dole out some praise. Rather than go scorched earth in an appearance on Fox Business, JPMorgan Chase CEO Jamie Dimon defended the idea of some tariffs, saying it is “perfectly reasonable for someone to say trade was unfair.” Pershing Square's Bill Ackman also made sure to pad the criticism, writing on X that he had “a lot of respect for our president and what he has accomplished so far." 3️⃣ Speak on platforms where you know he’ll be listening. Trump is an avid consumer of television news and social media, so finance chiefs took to these mediums to speak to the president directly. Dimon, for example, knew Trump would be watching his Fox Business appearance. 4️⃣ Offer a way out, and let him take the credit. Ackman first posed the idea of a 90-day pause, and Trump’s eventual announcement looked strikingly similar to that suggestion. Ackman, however, let Trump claim credit, posting on X, “This was brilliantly executed by @realDonaldTrump. Textbook, Art of the Deal.” The post led to a collective groan on social media, but it was more effective with Trump than an “I told you so.” My latest for Bloomberg Opinion. https://lnkd.in/ePnRxART

Why the risk of stagflation is so problematic for central banks: Reflecting more significant concerns about upcoming inflation dynamics, the last two days' remarks by Federal Reserve officials are consistent with the conclusion of this column from Tuesday (link below) -- that is to say, unless there is a financial market malfunction, which we came close to a few days ago, the Fed would need to sequentially (rather than simultaneously) seek to meet its dual mandate by placing the inflation objective before the employment one. https://lnkd.in/eXa5-TN7 #economy #markets #federalreserve Bloomberg Opinion

On the upcoming Iran talks, Andreas Kluth talks about the elephant in the room: The Iranians have no reason to believe anything that comes out of the Trump administration's mouth. And without a basic level of predictability and trust, no negotiation can succeed. "Trump's fans keep reciting the canard that he intuits the Art of the Deal or plays multi-dimensional chess. In reality, the president has been contradicting himself and garbling his signals to an extent that now hampers negotiations with any rational actors, whether they’re in Tehran, Beijing, Moscow or Pyongyang, or even (when the subject is tariffs) in Brussels, Ottawa or Mexico City. Not to mention irrational actors. The confusion starts with his underlying shtick, sometimes called the Madman Theory. As MAGA stans gloat, Trump is so unpredictable that his opponents get scared, which allegedly makes them weak and him strong. As the scholar Roseanne McManus has shown, however, this strategy, or disposition, easily backfires. Adversaries may conclude that the madman is a wild card who cannot be trusted to abide by any agreement, so that yielding is at best pointless and at worst suicidal." #Trump #Iran #negotiations

COLUMN: Here's an economic truth that fossil fuel detractors rarely talk about: The US oil industry has done more to reduce its country’s trade deficit than any other. Thanks to geological luck, engineering prowess, and shrewd capitalism, the shale revolution turned what two decades ago was a nearly $400 billion-a-year oil trade deficit into a $45 billion surplus in 2024. Now, President Donald Trump, in theory the champion of “drill, baby, drill,” risks killing it. "Trump is wishing for an oil crash. In the process, he will destroy what has been the most efficient tool to reduce the US trade deficit over the last 20 years. That seems ill-conceived. But then, almost all White House trade policy is." Bloomberg Opinion #oil #trade #tradewar

Fewer than 100 days into his second term as president, Donald Trump can so far claim at least one kind of success: He’s restarted negotiations between the US and some of its adversaries, first Russia and now Iran. On Saturday, Trump’s “special envoy” for seemingly everything, Steve Witkoff, will meet high-level Iranians in Oman to discuss ways to constrain Tehran’s nuclear program and avert war. The problem — as hostage negotiators, relationship therapists and others can confirm — is that talking doesn’t always solve a problem and can even make it worse, depending on the intentions, interests and mental states of the interlocutors. The Iranians (like the Russians) are notoriously shifty negotiators. But so are the Americans, now that they’re led by Trump. His fans keep reciting the canard that he intuits the Art of the Deal or plays multi-dimensional chess. In reality, the president has been contradicting himself and garbling his signals to an extent that now hampers negotiations with any rational actors, whether they’re in Tehran, Beijing, Moscow or Pyongyang, or even (when the subject is tariffs) in Brussels, Ottawa or Mexico City. Not to mention irrational actors. The confusion starts with his underlying shtick, sometimes called the Madman Theory. As MAGA stans gloat, Trump is so unpredictable that his opponents get scared, which allegedly makes them weak and him strong. As the scholar Roseanne McManus has shown, however, this strategy, or disposition, easily backfires. Adversaries may conclude that the madman is a wild card who cannot be trusted to abide by any agreement, so that yielding is at best pointless and at worst suicidal. That is how Ali Khamenei, Iran’s supreme leader, probably sees the American president.... (Read the whole column. NO PAYWALL with this link) Bloomberg Opinion https://bloom.bg/42Fnu3W

Did Trump manipulate the markets? Matt Levine has all the answers. Sign up for his free newsletter: https://lnkd.in/eV55A7pU

Amid the turmoil at HHS, a disturbing pattern has emerged: research addressing differences in the health and well-being of LGBTQ Americans is being acutely targeted. According to a Bloomberg Opinion analysis, more than half of the 550 grants terminated over the last six weeks by the National Institutes of Health — collectively estimated to be worth billions of dollars — addressed LGBTQ health somehow. The Trump administration’s aim appears twofold: to deny the existence of disparities affecting nearly one in 10 Americans and to ensure there’s no paper trail proving the harm caused by policies that target the community. Read more in my latest Bloomberg Opinion (no paywall): https://lnkd.in/gMD4FRWd

Who will blink first in the trade war: Trump or Xi? 🎙️ Ruth Pollard will be live with Shuli Ren, Karishma Vaswani and Catherine Thorbecke to answer your questions, 9pm EDT/9am HKT: https://bloom.bg/4clknkU

The S&P 500 staged a historic bounce from a selloff that wiped out trillions from global share prices, soaring 9.5% Wednesday — the most since the global financial crisis, according to Bloomberg News. Subscribe to John Authers’ free markets newsletter from Bloomberg Opinion for all the latest updates: https://lnkd.in/eAFqcjE8