While he charmed, helping audiences almost slis with a credible picture of a booming American economy about to scale new technological heights, he simultaneously threatened those with tariffs who chose not to move their factories to the US.
Trillions of dollars in revenue for the US Treasury for these businesses exporting from foreign factories to the US market.
“Your bias,” he said, with a smile like a Godfather movie. And then for one of them, Bank of America Chief Brian Moyhan, went on a remarkable public rampage accusing many of his conservative supporters of “debanking.”
He awkwardly mumbled about World Cup sponsorship.
In this first week of his second term, most people in Davos are shaking their heads, because they still can’t think of anything else to do.
Two worlds collide, as the ‘America First’ president is thrust into the beating heart of the rules-based international economic order like a 30-foot emperor of international planning.
This is one thing to suggest that trade deficits are an issue in your home constituency. It’s quite another to suggest in an international forum that a G7 ally, Canada, becomes the state of your nation, to gasps in the audience, not just Canada’s.
The address was design, catchy and offensive. For the rest of the world there was the carrot and the stick.
As delegates absorbed a mix of threats, invitations and, on occasion, praise, many were trying to judge how much damage Trump might do to the global trading system, while predicting How far ahead their US is in this tech-driven AI boom.
DeVos has been an alternate pole for Trump’s second term for the first week.
His agenda included a concerted effort to use every means to lower energy prices by pressuring the Saudis on oil.
He said they not only helped reduce inflation, but also saved Russia’s war with petrodollars, through economic means, to help end the Ukraine war. The ceasefire in the Middle East has already bought Trump some geopolitical credibility in these circles.
Christine Lagarde, David Miliband, and John Kerry turned into Hall. Various bank heads gathered on stage to applaud and then lightly quiz the president.
The bottom line was: Is President Trump serious about what the campaign trail seems like threats to the global economic system? The answer will be born again for the next four years and beyond.
The answer seemed to be a definite, yes. However, that doesn’t mean it’s working.
Some prominent US CEOs told me they are preparing tit-for-tat retaliatory tariffs to be applied to their exports. Their assumption was that the president’s love of a rising stock market would limit his rate hikes.
But no one really knows. In any case, there’s a lot up for grabs. He has already withdrawn from the World Health Organization.
His Project 2025 allies even advised us to withdraw from the IMF and the World Bank in whispers of promises.
The rest of the world has some counter-gains, once it decides to come back after the Trump whirlwind.
Canada is now briefing its retaliatory tariffs. In conversations with both the British business secretary and EU trade minister, Jonathan Reynolds, and the EU’s trade chief, Marus Seifkoch, I detected a desire for calmer dialogue.
Both are making similar arguments to try to block Trump from broader tariffs.
Mr. Reynolds told me that since America does not have a goods trade deficit with Great Britain, tariffs are not needed.
Mr Saif Kovich said the US should also really think about its services surplus.
But don’t they find G7 and NATO allies Canada and Denmark (more than Greenland) to be just as unacceptable and ridiculous as France claiming Louisiana? Saif Kovic didn’t want to flog anything.
Diplomats are drawing up lists of US goods that Europe can now buy to demonstrate a “win” for President Trump, from weapons to gas to magnets in wind turbines.
To focus the minds of Congress and competing factions within Trump’s court, it might make some sense for the rest of the G7 to work in unison on tariff retaliation.
There is no sign of it happening.
The story of American tech supremacy was presented by broligarchy — with Amazon founder Jeff Bezos, meta boss Mark Zuckerberg, Apple leader Tim Cook, and Google chief Sundar Pichar taking top seats at the inauguration this week.
Although the US is streets ahead of Europe, its position vis-Ã -vis China is more uncertain.
One talk about Davos was a high-performance, very cheap AI model from China-made Dipsec. Predictions that the tech bros would court each other in Trump’s court came true within hours rather than months.
Meanwhile, thanks in large part, though not all, to Trump’s tech-fueled optimism here in Davos, some in Europe have a once-in-a-lifetime opportunity to attract top researchers. which may be less affected by direction. American politics. It was openly proposed by European Central Bank chief Christine Lagarde.
Others took solace in the fact that Europe would no longer have to deal with Biden’s massive green subsidies, creating a more level playing field for Europe once again.
President Trump is changing the terms of global trade. The reaction of the rest of the world to this is as important as the decision of the Trump administration itself.
