We're all just pawns in the game but what the current administration is doing is either a high stakes poker game or multi dimensional chess. Based on the way its being handled it feels more like a poker game and Trump is just hoping Mexico, Canada, the EU and China don't call his bluff, in the sense that these tariffs will stay on forever and this is the new economic policy. The US has $3T+ in debt coming due, does the US really have the cards to play a winning hand? The goal with tariffs is to help US business's get a level playing field on the international field, but at what cost. Is this really the right move, at this time? What are we sacrificing to win, the game is just starting and we lost $5T+ in stock market value. I wish someone in the white house would publish a cost benefit analysis.
The Risks/Worst Economic Case Scenario
A USA embargo. For those unfamiliar, Embargo-an official ban on trade or other commercial activity with a particular country. The US currently has an Embargo against Cuba, making it illegal to have transaction with them. IF you don't think this will happen against the US, wake up, the gloves are coming off, no one is playing fair anymore, this administration clearly isnt. Decency and common sense have vanished. Trump told Zelensky he doesn't have the cards, but if Trump over plays HIS hand, we may see higher reciprocal tariffs against the US to make him sweat and possibly even an outright embargo against the US . Portugal Canceled their f35 contracts, Canada canceled their Starlink contract, people in Europe are refusing to buy US goods by flipping them upside down. If the US annexes Greenland and takes the Panama Canal by force. Embargo is a real possibility, getting blacklisted would be catastrophic. The US has the advantage of reserve currency status but that can literally change overnight if the world order changes, everyone starts looking for new trading partners and trade deals.
I think we're seeing such a selloff because international investors no longer feel safe investing in the US. Its too risky and stocks look like they're having a fire sale, get me out at whatever price. If the Panama canal and Greenland are annexed, the US is right up there with Russia, Venezuela, China and North Korea. AI and the "next industrial revolution" will become irrelevant, the new game will be resources, commodities, reliable trade partners and hard assets(Gold). We'll need to wait and see how the pieces on the chess board move.