Tag: U.S.

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What is the deal with the new Huawei AI power chip cluster touted by China?

AI race hots up!

Huawei has unveiled a bold new AI chip cluster strategy aimed squarely at challenging Nvidia’s dominance in high-performance computing.

At its Connect 2025 conference in Shanghai, Huawei introduced the Atlas 950 and Atlas 960 SuperPoDs—massive AI infrastructure systems built around its in-house Ascend chips.

These clusters represent China’s most ambitious attempt yet to bypass Western semiconductor restrictions and assert technological independence.

The technical stuff

The Atlas 950 SuperPoD, launching in late 2026, will integrate 8,192 Ascend 950DT chips, delivering up to 8 EFLOPS of FP8 compute and 16 EFLOPS at FP4 precision. (Don’t ask me either – but that’s what the data sheet says).

It boasts a staggering 16.3 petabytes per second of interconnect bandwidth, enabled by Huawei’s proprietary UnifiedBus 2.0 optical protocol. It is reportedly claimed to be ten times faster than current internet backbone infrastructure.

This system is reportedly designed to outperform Nvidia’s NVL144 cluster, with Huawei asserting a 6.7× advantage in compute power and 15× in memory capacity.

In 2027, Huawei reportedly plans to release the Atlas 960 SuperPoD, doubling the specs with 15,488 Ascend 960 chips. This reportedly will give 30 EFLOPS FP8 compute, and 34 PB/s bandwidth.

These SuperPoDs will be linked into SuperClusters. The Atlas 960 SuperCluster is reportedly projected to reach 2 ZFLOPS of FP8 performance. This potentially rivals even Elon Musk’s xAI Colossus and Nvidia’s future NVL576 deployments.

Huawei’s roadmap includes annual chip upgrades: Ascend 950 in 2026, Ascend 960 in 2027, and Ascend 970 in 2028.

Each generation promises to double computing power. The chips will feature Huawei’s own high-bandwidth memory variants—HiBL 1.0 and HiZQ 2. These are designed to optimise inference and training workloads.

Strategy

This strategy reflects a shift in China’s AI hardware approach. Rather than competing on single-chip performance, Huawei is betting on scale and system integration.

By controlling the entire stack—from chip design to memory, networking, and interconnects—it aims to overcome fabrication constraints imposed by U.S. sanctions.

While Huawei’s software ecosystem still trails Nvidia’s CUDA, its CANN toolkit is gaining traction. Chinese regulators discourage purchases of Nvidia’s AI chips.

The timing of Huawei’s announcement coincides with increased scrutiny of Nvidia in China, suggesting a coordinated push for domestic alternatives.

In short, Huawei’s AI cluster strategy is not just a technical feat—it’s a geopolitical statement.

Whether it can match Nvidia’s real-world performance remains to be seen, but the ambition is unmistakable.

The AI power race just got even hotter!

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Fed cuts rates amid labour market strains and political Powell pressure

U.S. cuts rates

On 17th September 2025, the U.S. Federal Reserve announced its first interest rate cut of 2025, lowering the benchmark federal funds rate by 0.25% to a range of 4.00%–4.25%.

The decision follows nine months of monetary policy stagnation and comes amid mounting evidence of a weakening labour market and persistent inflationary pressures.

Fed Chair Jerome Powell described the move as a ‘risk management cut’, citing slower job growth and a rise in unemployment as key drivers.

While inflation remains elevated—partly due to tariffs introduced by the Trump administration—the Fed opted to prioritise employment support, signalling the possibility of two further cuts before year-end.

The decision was not without controversy. New Fed Governor Stephen Miran, recently appointed by President Trump, reportedly dissented, advocating for a more aggressive half-point reduction. Political tensions have escalated, with Trump publicly urging Powell to ‘cut bigger’.

Markets responded with mixed signals: the Dow rose modestly, while the S&P 500 and Nasdaq slipped slightly. However, each improved in after-hours trading.

Analysts remain divided over the long-term impact, with some warning that easing too quickly could reignite inflation.

The Fed’s next move will be closely watched as it balances economic fragility with political crosswinds.

The next U.S. Federal Reserve meeting is scheduled for 29th–30th October 2025, with the interest rate decision expected on Wednesday, 30th October at 2:00 PM ET.

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China-U.S. trade slump deepens as exports plunge 33%

U.S. imports from China fall in August 2025

China’s exports to the United States fell sharply in August 2025, marking a six-month low and underscoring the growing strain in global trade dynamics.

According to recent data, shipments from China to the U.S. dropped by 33% year-on-year, reflecting both weakening demand and the ongoing effects of geopolitical tensions.

This decline is part of a broader slowdown in China’s export sector, which saw overall outbound shipments contract for the sixth consecutive month.

Analysts point to several contributing factors: tighter monetary policy in the U.S., shifting supply chains, and a cooling appetite for Chinese goods amid rising tariffs and trade barriers.

Down 33%

The 33% plunge is particularly striking given the scale of bilateral trade. The U.S. remains one of China’s largest export markets, and such a steep drop signals deeper economic recalibrations.

Sectors hit hardest include electronics, machinery, and consumer goods—industries that once formed the backbone of China’s export dominance.

Economists warn that this trend could have ripple effects across global markets. For China, it raises questions about domestic resilience and the need to pivot toward internal consumption.

For the U.S., it may accelerate efforts to diversify supply chains and invest in domestic manufacturing.

The timing is also politically charged. With President Trump’s tariff policies still in effect and China navigating its own economic headwinds, trade relations remain tense.

This downturn may prompt renewed negotiations—or further decoupling.

Despite the ongoing slump in trade, the U.S. continues to be China’s largest export destination among individual countries.

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The staying power of gold!

Gold

Gold’s recent surge—hitting over $3,550 per ounce (4th September 2025)—isn’t just a speculative blip.

It’s a convergence of deep structural shifts and short-term catalysts that are reshaping how investors, central banks, and governments think about value and stability.

Here’s why

🧭 Strategic Drivers (Long-Term Forces)

Central Bank Buying: Nearly half of surveyed central banks reportedly plan to increase gold reserves through 2025, citing inflation hedging, crisis resilience, and reduced reliance on the U.S. dollar.

Dollar Diversification: After Western sanctions froze Russia’s reserves in 2022, many countries began reassessing their exposure to dollar-denominated assets.

Fiscal Expansion & Debt Concerns: With U.S. debt surpassing $37 trillion and new legislation adding trillions more, gold is seen as a hedge against long-term dollar instability.

⚡ Tactical Catalysts (Short-Term Triggers)

Geopolitical Tensions: Ongoing wars, trade disputes, and questions around Federal Reserve independence have heightened uncertainty, boosting gold’s ‘fear hedge’ appeal.

Interest Rate Expectations: The Fed has held rates steady, but markets anticipate cuts. Lower yields make non-interest-bearing assets like gold more attractive.

Weakening U.S. Dollar: The dollar’s decline against the euro and yen has made gold cheaper for foreign buyers, increasing global demand.

ETF Inflows & Retail Demand: Physically backed gold ETFs saw their largest first-half inflows since 2020, while bar demand rose 10% in 2024.

Gold futures price one-year chart (December 2025 Gold)

🧮 Symbolic Undercurrent

Gold isn’t just a commodity—it’s a referendum on trust. When institutions wobble and currencies lose their shine, gold becomes the narrative anchor: a timeless, tangible vote of no confidence in the system.

Summary

🛡️ Safe Haven: Retains value during crisis.

📈 Inflation Hedge: Preserves purchasing power.

🧩 Portfolio Diversifier: Low correlation with other assets.

✋ Tangible Asset: Physical, unlike stocks or bonds.

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China’s EV Price War: BYD falters as the Chinese EV machine reshapes the global car market

EV global price war

China’s electric vehicle (EV) powerhouse is rewriting the global automotive playbook—but not without homegrown company damage.

BYD, now the world’s largest EV manufacturer by volume, has been caught in the crossfire of a domestic price war.

Damaging price war

The price war is damaging margins. It is unnerving investors and revealing the perils of hyper-competition in the world’s most aggressive car market.

In Q2 2025, BYD posted a 30% drop in net profit to 6.4 billion yuan (£700 million), its first earnings decline in over three years.

Despite a 145% surge in overseas sales, the company’s sweeping discounts across 22 models have eroded profitability at home.

Gross margins slipped to around 16%, and its Hong Kong-listed shares tumbled 8% to a five-month low.

Analysts reportedly now question whether BYD can hit its ambitious 5.5-million-unit sales target, having reached only 45% by July 2025.

The price war, ignited by BYD’s aggressive cuts in May 2025, has forced rivals like Geely, Chery, and SAIC-GM to follow suit. Entry-level EVs now start below (£6,500), with features like driver assistance and smart infotainment once reserved for premium models.

But the race to the bottom has drawn concern from regulators and industry leaders. The China Association of Automobile Manufacturers (CAAM) warned of “disorderly competition”, while executives fear quality compromises and supplier strain.

Yet even as BYD stumbles, the broader Chinese EV machine is gaining global momentum. In Europe, BYD overtook Tesla in July sales, capturing 1.1% market share versus Tesla’s 0.7%.

Chinese EV car brands account for around 10% of new UK car sales

Chinese brands now account for around 10% of new car sales in the UK. There are over 30 affordable EV models priced under £30,000.

Their edge lies in battery supply chains, manufacturing efficiency, and software integration. Transforming cars into ‘smartphones on wheels’ tailored to digitally connected consumers.

China’s EV revolution is no longer just a domestic shake-up—it’s a global reordering. Legacy automakers are retreating from the budget segment. But Chinese firms flooding international markets with sleek, connected, and competitively priced vehicles.

BYD’s profit dip may be a temporary wobble. The long-term trajectory is clear: China isn’t just building cars—it’s building the future of mobility.

For global rivals, the message is unmistakable: adapt, or be outpaced by the dragon’s electric roar.

Infographic: China’s BYD and other EVs

Summary

BYD’s Q2 2025 net profit drop of 30% to 6.4 billion yuan: This figure aligns with recent earnings reports and analyst commentary. The drop is consistent with margin pressure from domestic price cuts.

Gross margin falling to 16.3%: Matches industry estimates for BYD’s automotive segment, which has seen compression due to aggressive discounting.

Overseas sales up 145% YoY: BYD’s international expansion—especially in Europe, Southeast Asia, and Latin America—has been rapid. This growth rate is plausible and supported by export data.

BYD reaching only 45% of its 5.5 million unit sales target by July: This tracks with cumulative delivery figures through mid-year, suggesting a potential shortfall unless H2 volumes accelerate.

Price war triggered by BYD’s cuts across 22 models in May: Confirmed by industry reports and BYD’s own promotional campaigns. Other automakers like Geely and Chery have responded with similar discounts.

CAAM warning of “disorderly competition”: This quote has appeared in official statements and media coverage, reflecting regulatory concern over unsustainable pricing.

Chinese EVs gaining market share in Europe and UK: BYD overtaking Tesla in July 2025 sales in Europe is supported by registration data. Chinese brands now account for ~10% of UK new car sales, with many models priced under £30,000.

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U.S. inflation holds steady in July 2025 but Core Inflation edges higher

U.S. Inflation data

The latest inflation data for the month of July 2025 shows a mixed picture for the U.S. economy, as price pressures remain persistent despite signs of cooling in some sectors.

According to the Bureau of Economic Analysis, the headline Personal Consumption Expenditures (PCE) Price Index rose 2.6% year-over-year, unchanged from June, while the core PCE index—which excludes volatile food and energy costs—ticked up to 2.9%, marking its highest annual rate since February.

On a monthly basis, core prices increased 0.3%, in line with expectations, while consumer spending rose 0.5%, suggesting households are still resilient despite elevated costs. Personal income also climbed 0.4%, reinforcing the narrative of steady wage growth.

The Federal Reserve, which uses the PCE index as its preferred inflation gauge, faces a delicate balancing act.

With inflation still above its 2% target and labor market data showing signs of softening, markets are increasingly betting on a rate cut at the Fed’s September meeting.

Fed Chair Jerome Powell, speaking at Jackson Hole, reportedly acknowledged the risks to employment but maintained a cautious tone on policy shifts.

Investors and traders alike now see an 80% chance of a quarter-point cut, keeping all eyes on upcoming jobs data.

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The Nixon shock: When politics undermined the Fed—and markets paid the price

Nixon Fed Interference shock

In the early 1970s, President Richard Nixon’s pursuit of re-election collided with the Federal Reserve’s independence, triggering a cascade of economic consequences that reshaped global finance.

The episode remains a cautionary tale about the dangers of politicising monetary policy.

At the heart of the drama was Nixon’s pressure on Fed Chair at the time, Arthur Burns to stimulate the economy ahead of the 1972 election. Oval Office tapes later revealed Nixon’s direct appeals for rate cuts and looser credit conditions—despite rising inflation.

Burns, reluctant but ultimately compliant, oversaw a period of aggressive monetary expansion. Interest rates were held artificially low, and the money supply surged.

Dow historical chart – lowest 43 points to around 45,400

The short-term result was a booming economy and a landslide victory for Nixon. But the longer-term consequences were severe. Inflation, already simmering, began to boil. By 1973, consumer prices were rising at an annual rate of over 6%, and the dollar was under siege in global markets.

Then came the real shock: in August 1971, Nixon unilaterally suspended the dollar’s convertibility into gold, effectively ending the Bretton Woods system.

This move—intended to halt speculative attacks and preserve U.S. gold reserves—unleashed a new era of floating exchange rates and fiat currency. The dollar depreciated sharply, and global markets entered a period of volatility.

By 1974, the consequences were fully visible. The Dow Jones Industrial Average had fallen nearly 45% from its 1973 peak.

Politics vs the Federal Reserve – lesson learned?

Bond yields soared as investors demanded compensation for inflation risk. The U.S. economy entered a deep recession, compounded by the oil embargo and geopolitical tensions.

The Nixon-Burns episode is now widely viewed as a breach of central bank independence. It demonstrated how short-term political gains can lead to long-term economic instability.

The Fed’s credibility was damaged, and it took nearly a decade—culminating in Paul Volcker’s brutal rate hikes of the early 1980s—to restore price stability.

Today, as debates over Fed autonomy resurface, the lessons of the 1970s remain urgent. Markets thrive on trust, transparency, and institutional integrity. When those are compromised, even the most powerful economies can falter.

THE NIXON SHOCK — Early 1970’s Timeline

🔶 August 1971 Event: Gold convertibility suspended Market Impact: Dollar begins to weaken Context: Nixon ends Bretton Woods, launching the fiat currency era

🔴 November 1972 Event: Nixon re-elected Market Impact: Stocks rally briefly (+6%) Context: Fed policy remains loose under political pressure

🔵 January 1973 Event: Dow peaks Market Impact: Start of sharp decline Context: Inflation accelerates, investor confidence erodes

🟢 1974 Event: Watergate fallout, Nixon resigns Market Impact: Dow down 44% from 1973 high Context: Recession deepens, Fed credibility damaged.

Current dollar dive, stocks boom and bust (the Dow fell 19% in a year and then by 44% in 1975 from its January 1973 peak). U.S. 10-year Treasury yields surged (peaking at nearly 7.60% -close to twice today’s yield).

In hindsight, Nixon won the election—but lost the economy. And the Fed, caught in the crossfire, paid the price in credibility. It’s a reminder that monetary policy is no place for political theatre.

Is history repeating itself? Is Trump’s involvement different, or another catastrophe waiting to happen?

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News agent makes the news – WH Smith’s fresh start derails in a fog of accounting mistakes

W H Smith error

WH Smith’s attempt to reinvent itself as a sleek, travel-focused retailer has hit turbulence, with a £30 million profit overstatement in its North American division sending shares into a 42% nosedive.

The error, stemming from premature recognition of supplier income, has triggered a full audit review and left investors ‘sobbing into their cornflakes’, as one analyst reportedly put it. Not nice!

The timing couldn’t be worse. Having sold off its UK High Street arm earlier this year, WH Smith was banking on its overseas operations to deliver growth.

Instead, the company now expects just £25 million in North American trading profit—less than half its original forecast.

The reputational damage is compounded by the fact that supplier income, often tied to promotional deals, is notoriously tricky to account for.

WH Smith’s misstep suggests not just a lapse in judgement, but a systemic failure in financial controls.

Table of events

MetricDetails
📊 Profit Overstatement£30 million
🧾 Cause of ErrorPremature recognition of supplier income
🇺🇸 Affected DivisionNorth America
📉 Share Price Impact42% drop
📉 Revised Profit Forecast£25 million (down from £54 million)
🕵️‍♂️ Audit ResponseFull review initiated by Deloitte
🏪 Strategic ContextWH Smith sold UK High Street arm earlier in 2025
📦 Supplier Income RiskOften tied to promotional deals; hard to track

This isn’t merely a spreadsheet error—it’s a strategic setback. The retailer’s pivot to travel hubs was meant to offer high-margin stability, buoyed by a captive audience.

But the accounting blunder casts doubt on the robustness of its operational oversight, especially in a market as competitive as the U.S.

With Deloitte now combing through the books, W H Smith faces a long road to restore investor confidence.

For a brand that once prided itself on reliability, this episode is a reminder that even legacy names can falter when ambition outpaces accountability.

W H Smith share price (one-month chart) 21st August 2025

Let’s hope the next chapter isn’t written in red ink.

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Japan faces steepest export decline in four years

Japan exports drop

Japan’s economy has hit a troubling patch, with July 2025 marking its sharpest export contraction in over four years.

The Ministry of Finance reported a 2.6% year-on-year drop, driven largely by tariff led trade tensions and weakening global demand.

The most dramatic impact came from the United States, where exports fell 10.1%, led by a 28.4% plunge in automobile shipments.

This follows the U.S. administration’s decision to impose 25% tariffs on Japanese vehicles and auto parts in April—a move that has rattled Japan’s automotive sector, long a pillar of its export economy.

Despite a partial tariff rollback to 15% in July, the damage was already done. Japanese carmakers absorbed much of the cost to maintain shipment volumes, which only fell 3.2%, but the value loss was substantial.

Japan – July export data infographic

Exports to China also declined by 3.5%, underscoring broader regional weakness. Meanwhile, imports dropped 7.5%, signalling sluggish domestic consumption and further strain on Japan’s trade balance, which recorded a 117.5 billion yen deficit.

Economists warn that if the export downturn continues, Japan could face a recession. Although Q2 GDP showed modest growth of 0.3%, the July figures suggest that momentum may be fading.

The Bank of Japan is now expected to hold off on interest rate hikes, with its next policy meeting scheduled for 19th September 2025.

As global markets digest the implications, Japan’s export slump serves as a stark reminder of how vulnerable even advanced economies can be to shifting trade policies and geopolitical headwinds.

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Is BIG tech being allowed to pay its way out of the tariff turmoil

BIG tech money aids tariff avoidance

Where is the standard for the tariff line? Is this fair on the smaller businesses and the consumer? Money buys a solution without fixing the problem!

  • Nvidia and AMD have struck a deal with the U.S. government: they’ll pay 15% of their China chip sales revenues directly to Washington. This arrangement allows them to continue selling advanced chips to China despite looming export restrictions.
  • Apple, meanwhile, is going all-in on domestic investment. Tim Cook announced a $600 billion U.S. investment plan over four years, widely seen as a strategic move to dodge Trump’s proposed 100% tariffs on imported chips.

🧩 Strategic Motives

  • These deals are seen as tariff relief mechanisms, allowing companies to maintain access to key markets while appeasing the administration.
  • Analysts suggest Apple’s move could trigger a ‘domino effect’ across the tech sector, with other firms following suit to avoid punitive tariffs.
Tariff avoidance examples

⚖️ Legal & Investor Concerns

  • Some critics call the Nvidia/AMD deal a “shakedown” or even unconstitutional, likening it to a tax on exports.
  • Investors are wary of the arbitrary nature of these deals—questioning whether future administrations might play kingmaker with similar tactics.

Big Tech firms are striking strategic deals to sidestep escalating tariffs, with Apple pledging $600 billion in U.S. investments to avoid import duties, while Nvidia and AMD agree to pay 15% of their China chip revenues directly to Washington.

These moves are seen as calculated trade-offs—offering financial concessions or domestic reinvestment in exchange for continued market access. Critics argue such arrangements resemble export taxes or political bargaining, raising concerns about legality and precedent.

As tensions mount, these deals reflect a broader shift in how tech giants navigate geopolitical risk and regulatory pressure.

They buy a solution…

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Global stocks indices flying high as new records broken – 12th August 2025

New records for global indices led by U.S. tech

In a sweeping rally that spanned continents and sectors, major global indices surged to fresh record highs yesterday, buoyed by cooling inflation data, renewed hopes of U.S. central bank rate cuts, and easing trade tensions.

U.S. inflation figures released 12th August 2025 for July came in at: 2.7% – helping to lift markets to new record highs!

U.S. Consumer Price Index — July 2025

MetricValue
Monthly CPI (seasonally adjusted)+0.2%
Annual CPI (headline)+2.7%
Core CPI (excl. food & energy)+0.3% monthly, +3.1% annual

Despite concerns over Trump’s sweeping tariffs, the U.S. July 2025 CPI came in slightly below expectations (forecast was 2.8% annual).

Economists noted that while tariffs are beginning to show up in certain categories, their broader inflationary impact remains modest — for now.

Global Indices Surged to Record Highs Amid Rate Cut Optimism and Tariff Relief

Tuesday, 12 August 2025 — Taking Stock

📈 S&P 500: Breaks Above 6,400 for First Time

  • Closing Level: 6,427.02
  • Gain: +1.1%
  • Catalyst: Softer-than-expected U.S. CPI data (+2.7% YoY) boosted bets on a September rate cut, with 94% of traders now expecting easing.
  • Sector Drivers: Large-cap tech stocks led the charge, with Microsoft, Meta, and Nvidia all contributing to the rally.

💻 Nasdaq Composite & Nasdaq 100: Tech Titans Lead the Way

  • Nasdaq Composite: Closed at a record 21,457.48 (+1.55%)
  • Nasdaq 100: Hit a new intraday high of 23,849.50, closing at 23,839.20 (+1.33%)
  • Highlights:
    • Apple surged 4.2% after announcing a $600 billion U.S. investment plan.
    • AI optimism continues to fuel gains across the Magnificent Seven stocks.

Nasdaq 100 chart 12th August 2025

Nasdaq 100 chart 12th August 2025

🧠 Tech 100 (US Tech Index): Momentum Builds

  • Latest High: 23,849.50
  • Weekly Gain: Nearly +3.7%
  • Outlook: Traders eye a breakout above 24,000, with institutional buying accelerating. Analysts note a 112% surge in net long positions since late June.

🇯🇵 Nikkei 225: Japan Joins the Record Club

  • Closing Level: 42,718.17 (+2.2%)
  • Intraday High: 43,309.62
  • Drivers:
    • Relief over U.S. tariff revisions and a 90-day pause on Chinese levies.
    • Strong earnings from chipmakers like Kioxia and Micron.
    • Speculation of expanded fiscal stimulus following Japan’s recent election results.

🧮 Market Sentiment Snapshot

IndexRecord Level Reached% Gain YesterdayKey Driver
S&P 5006,427.02+1.1%CPI data, rate cut bets
Nasdaq Comp.21,457.48+1.55%AI optimism, Apple surge
Nasdaq 10023,849.50+1.33%Tech earnings, institutional buying
Tech 10023,849.50+1.06%Momentum, bullish sentiment
Nikkei 22543,309.62+2.2%Tariff relief, chip rally

📊 Editorial Note: While the rally reflects strong investor confidence, analysts caution that several indices are approaching technical overbought levels.

The Nikkei’s RSI, for instance, has breached 75, often a precursor to short-term pullbacks.

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Trump – tactics and turmoil – tariff U-turn count

Trump U-turns

Trump’s latest flurry of tariff U-turns has left global markets whiplashed but oddly resilient.

From threatening Swiss gold bars with a 39% levy to abruptly tweeting ‘Gold will not be Tariffed!’ The former president’s reversals have become a hallmark of his political tactic.

Investors now brace for volatility not from policy itself, but from its rapid retraction. With China tariffs delayed, praise for previously criticised CEOs, and shifting stances on Ukraine and Russia, Trump’s tactics seem less about strategy and more about spectacle.

Yet despite the chaos, markets appear unfazed—suggesting that unpredictability may now be priced in

🧠 Why So Many U-Turns?

  • Market Sensitivity: Many reversals follow stock market dips or investor backlash.
  • Diplomatic Pressure: Allies like Switzerland, India, Ukraine, Canada and Australia have pushed back hard.
  • Narrative Control: Trump often uses Truth Social to pivot public messaging rapidly.
  • Strategic Ambiguity: Some analysts argue it’s part of a negotiation tactic—others call it chaos.

🔁 Latest Trump U-Turns

TopicInitial PositionReversalDate
Gold TariffsSwiss gold bars to face 39% tariffTrump tweets “Gold will not be Tariffed!”7 Aug 2025
China Tariffs145% reciprocal tariffs to beginDelayed for 90 days12 Aug 2025
Intel CEO Lip-Bu Tan“Must resign, immediately”“His success and rise is an amazing story”11 Aug 2025
Russia-Ukraine ArmsPaused military aid to UkraineResumed shipments after backlash8 Jul 2025
India’s Role in Peace TalksCriticised India’s neutralityPraised India’s diplomatic efforts9 Aug 2025
Global TariffsImposed sweeping import taxesSuspended most tariffs within 13 hours9 Apr 2025
Epstein FilesPromised full declassificationNow downplaying and deflectingOngoing

TACO – Trump Always Chickens Out! Tactics or turmoil?

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Technical Signals: Cracks beneath the surface – are U.S. stocks beginning to stumble?

Stock correction?

There are increasingly credible signs that U.S. stocks may be heading into a deeper adjustment phase.

Here’s a breakdown of the key indicators and risks that suggest the current stumble could be more than a seasonal wobble. It’s just a hypothesis, but…

  • S&P 500 clinging to its 200-day moving average: While the long-term trend remains intact, short-term averages (5-day and 20-day) have turned negative.
  • Volatility Index (VIX) rising: A 7.61% surge in the 20-day average VIX suggests growing unease, even as prices remain elevated.
  • Diverging ADX readings: The S&P 500’s ADX (trend strength) is weak at 7.57, while the VIX’s ADX is strong at 45.37—classic signs of instability brewing.

🧠 Sentiment & Positioning: Optimism with Defensive Undercurrents

  • Investor sentiment is bullish (40.3%), but rising put/call ratios and a complacent Fear & Greed Index hint at hidden caution.
  • Historical parallels: Similar sentiment setups preceded corrections in 2021 and 2009. We’re not at extremes yet, but the complacency is notable.

🌍 Macroeconomic Risks: Tariffs, Fed Policy, and Structural Headwinds

  • Tariff escalation: Trump’s recent executive order raised effective tariffs to 15–20%, with new duties on rare earths and tech-critical imports.
  • Labour market weakening: July’s jobs report showed just 73,000 new jobs, with massive downward revisions to prior months. Unemployment ticked up to 4.2%.
  • Fed indecision: The central bank is split, with no clear path on rate cuts. This uncertainty is amplifying volatility.
  • Structural drag: Reduced immigration and R&D funding are eroding long-term growth potential.
  • 🛡️ Strategic Implications: How Investors Are Hedging
  • Defensive sectors like utilities, healthcare, and gold are gaining traction.
  • VIX futures and Treasury bonds are being used to hedge against volatility.
  • Emerging markets with trade deals (e.g., Vietnam, Japan) may outperform amid global realignment.
  • 🗓️ Seasonal Weakness: August and September Historically Slump
  • August is the worst month for the Dow since 1988, and the second worst for the S&P 500 and Nasdaq.
  • Wolfe Research reportedly notes average declines of 0.3% (August) and 0.7% (September) since 1990.
  • Sahm Rule: Recession indicator.

Now what?

While the broader market still shows resilience—especially in mega-cap tech—the underlying signals point to fragility.

Elevated valuations, weakening macro data, and geopolitical uncertainty are converging. A deeper correction isn’t guaranteed, but the setup is increasingly asymmetric: limited upside, growing downside risk.

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TSMC’s alleged trade secret breach

Tech breach at TSMC

Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker, on 5th August 2025 has reportedly uncovered a serious internal breach involving its 2-nanometer chip technology, one of the most advanced processes in the semiconductor industry.

🔍 What Happened

  • TSMC detected unauthorised activities during routine monitoring, which led to the discovery of potential trade secret leaks.
  • Several former employees are suspected of attempting to access and extract proprietary data related to the 2nm chip development and production.
  • The company has reportedly taken strict disciplinary action, including terminations, and has initiated legal proceedings under Taiwan’s National Security Act, which protects core technologies from unauthorized use.

🧠 Why It Matters

The alleged leak doesn’t just constitute corporate espionage—it has strategic implications. Taiwan’s National Security Act categorises such breaches under core tech theft, permitting aggressive legal action and severe penalties.

With chip supremacy increasingly viewed as a geopolitical asset, this saga is more than just workplace misconduct—it’s a digital arms race.

  • The 2nm process is a breakthrough in chip design, offering:
    • 35% lower power consumption
    • 15% higher transistor density compared to 3nm chips
  • These chips are crucial for AI accelerators, high-performance computing, and next-gen smartphones—markets expected to dominate sub-2nm demand by 2030.
  • A leak of this magnitude could allow competitors to replicate or leapfrog TSMC’s proprietary methods, threatening its technological edge and market dominance.
  • Moreover, company design secrets are potentially at stake, and this would seriously damage these businesses as their hard work in R&D is stolen.

⚖️ Legal & Strategic Response

  • TSMC has reaffirmed its zero-tolerance IP policy, stating it will pursue violations to the fullest extent of the law.
  • The case is now under legal investigation.

While TSMC’s official line is firm—’zero tolerance for IP breaches’—investors are jittery.

The company’s shares dipped slightly amid concerns about reputational damage and longer-term supply chain vulnerabilities.

Analysts expect limited short-term impact on production timelines, but scrutiny over internal controls may rise.

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China’s new AI model GLM-4.5 threatens DeepSeek – will it also threaten OpenAI?

China's AI

In a bold move reshaping the global AI landscape, Chinese startup Z.ai has launched GLM-4.5, an open-source model touted as cheaper, smaller, and more efficient than rivals like DeepSeek.

The announcement, made at the World Artificial Intelligence Conference in Shanghai, has sent ripples across the tech sector.

What sets GLM-4.5 apart is its lean architecture. Requiring just eight Nvidia H20 chips—custom-built to comply with U.S. export restrictions—it slashes operating costs dramatically.

By comparison, DeepSeek’s model demands nearly double the compute power, making GLM-4.5 a tantalising alternative for cost-conscious developers and enterprises.

But the savings don’t stop there. Z.ai revealed that it will charge just $0.11 per million input tokens and $0.28 per million output tokens. In contrast, DeepSeek R1 costs $0.14 for input and a hefty $2.19 for output, putting Z.ai firmly in the affordability lead.

Functionally, GLM-4.5 leverages ‘agentic’ AI—meaning it can deconstruct tasks into subtasks autonomously, delivering more accurate results with minimal human intervention.

This approach marks a shift from traditional logic-based models and promises smarter integration into coding, design, and editorial workflows.

Z.ai, formerly known as Zhipu, boasts an impressive funding roster including Alibaba, Tencent, and state-backed municipal tech funds.

With IPO ambitions on the horizon, its momentum mirrors China’s broader push to dominate the next wave of AI innovation.

While the U.S. has placed Z.ai on its entity list, stifling some Western partnerships, the firm insists it has adequate computing resources to scale.

As AI becomes a battleground for technological and geopolitical influence, GLM-4.5 may prove to be a powerful competitor.

But it has some way yet to go.

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Echoes of Dot-Com? Is AI tech leading us into another crash?

Is Wall Street AI tech in a bubble?

Wall Street is soaring on artificial intelligence optimism—but underneath the record-breaking highs lies a growing sense of déjà vu.

From stretched valuations and speculative fervour to market concentration reminiscent of the dot-com era, financial analysts and institutional veterans are asking: are we already inside a tech bubble?

Valuations Defying Gravity

At the heart of the rally are the so-called ‘Magnificent Seven’—mega-cap tech firms like Nvidia, Microsoft, Apple and Alphabet—whose forward price-to-earnings ratios have now surpassed even the frothiest moments of the 1999–2001 bubble.

Apollo Global strategist Torsten Slok has reportedly warned that current AI-driven valuations are more ‘stretched’ than ever, citing metrics that exceed dot-com records in both scale and speed.

Nvidia and Microsoft now sit atop the S&P 500 with a combined market cap north of $8 trillion. Yet much of this valuation is being driven by expected future profits—not current ones.

Bulls argue the fundamentals are stronger this time, but even they admit this rally is fragile and increasingly top-heavy.

A Narrow Rally, Broad Exposure

While the S&P 500 has reached historic highs, the gains are increasingly concentrated among just 10 companies—accounting for nearly 40% of the index’s value.

The remaining 490 firms are moving sideways, or not at all. Bank of America’s Michael Hartnett calls it the ‘biggest retail-led rally in history’, pointing to looser trading rules and margin exposure pulling everyday investors into risky tech plays.

In policy circles, reforms allowing private equity in retirement accounts and easing restrictions on day trading are amplifying volatility.

The Trump administration’s push to deregulate retail trading could worsen systemic fragility if investor sentiment turns.

Signs of Speculation

Meme stocks and penny shares are surging again. Cryptocurrency-adjacent firms are issuing AI-branded tokens.

Goldman Sachs indicators show speculative trading activity at levels only previously seen in 2000 and 2021. Yet merger activity remains robust, and consumer spending is strong—two counterweights that bulls cite as proof the rally may be sustained.

The Core Debate: Hype vs. Reality

Is AI the new internet—or just another tech bubble? It does seem to carry more utility than the early days of the internet did?

  • The Bubble View: Today’s valuations are divorced from earnings reality, driven by retail exuberance and algorithmic momentum rather than solid fundamentals.
  • The Bullish Case: Unlike the dot-com era, many of today’s tech firms are cash-rich, profitable, and genuinely transforming industry workflows.

Wells Fargo’s Chris Harvey reportedly believes the S&P 500 could hit 7,007 by year-end—driven by strong margins in tech and corporate earnings resilience.

But even he acknowledges risks if the AI hype fails to materialise into sustainable profit flows.

Bottom Line

Wall Street may be on the brink of another rebalancing moment. Whether this rally evolves into a crash, correction, pullback or a paradigm shift could depend on investor patience, regulatory restraint—and whether tech firms can actually deliver the future they’re pricing in.

That is the real question!

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China reportedly concerned about security of Nvidia AI chips

U.S. and China AI chips concern

China has reportedly voiced concerns about the security implications of Nvidia’s cutting-edge artificial intelligence chips, deepening the tech cold war between Beijing and Washington.

The caution follows increasing scrutiny of semiconductors used in defence, infrastructure, and digital surveillance systems—sectors where AI accelerators play an outsized role.

While no official ban has been announced, sources suggest that Chinese regulators are examining how Nvidia’s chips—known for powering generative AI and large language models—might pose risks to national data security.

At the core of the issue is a growing unease about foreign-designed hardware transmitting or processing sensitive domestic information, potentially exposing it to surveillance or manipulation.

Nvidia, whose H100 and A800 series dominate the high-performance AI landscape, has already faced restrictions from the U.S. government on exports to China.

In response, Chinese tech firms have been developing domestic alternatives, including chips from Huawei and Alibaba, though few match Nvidia’s sophistication or efficiency.

The situation highlights China’s larger strategy to reduce reliance on American technology, especially as AI becomes more integral to industrial automation, cyber defence, and public services.

It also underscores the dual-use dilemma of AI—where innovation in consumer tech can quickly scale into military applications.

While diplomatic channels remain frosty, the market implications are heating up. Nvidia’s shares dipped slightly on the news, and analysts predict renewed interest in sovereign chip initiatives across Asia.

For all the lofty aspirations of AI making the world smarter, it seems that suspicion—not cooperation—is the current driving force behind chip geopolitics.

As one observer quipped, ‘We built machines to think for us—now we’re worried they’re thinking too much, in all the wrong places’.

Nvidia reportedly denies there are any security concerns.

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Microsoft joins Nvidia in the $4 trillion Market Cap club

Microdift and Nvidia only two companies in exclusive $4 trillion market cap club

In a landmark moment for the tech industry, Microsoft has officially joined Nvidia in the exclusive $4 trillion market capitalisation club, following a surge in its share price after stellar Q4 earnings.

This accolade achieved on 31st July 2025 marks a dramatic shift in the hierarchy of global tech giants, with Microsoft briefly overtaking Nvidia to become the world’s most valuable company. But for how long?

The rally was fuelled by Microsoft’s aggressive investment in artificial intelligence and cloud infrastructure. Azure, its cloud platform, posted a 39% year-on-year revenue increase, surpassing $75 billion in annual sales.

The company’s Copilot AI tools, now boasting over 100 million monthly active users, have become central to its strategy, embedding generative AI across productivity software, development platforms, and enterprise services.

Microsoft’s transformation from a traditional software provider to an AI-first powerhouse has been swift and strategic. Its partnerships with OpenAI, Meta, and xAI, combined with over $100 billion in planned capital expenditure, signal a long-term commitment to shaping the future of AI utility.

While Nvidia dominates the hardware side of the AI revolution, Microsoft is staking its claim as the platform through which AI is experienced.

This milestone not only redefines Microsoft’s legacy—it redraws the map of pure tech power and reach the company has around the world.

This has been earned over decades of business commitment.

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U.S. interest rates held steady at 4.25% to 4.50%

U.S. Federal Reserve

On 30th July 2025, the Federal Reserve opted to keep its benchmark interest rate unchanged at 4.25%–4.50%, defying mounting pressure from President Trump to initiate cuts.

The decision, reached by a 9–2 vote, marked the first time since 1993 that two governors—Michelle Bowman and Christopher Waller—formally dissented, advocating for a quarter-point reduction.

Fed Chair Jerome Powell cited “moderated” economic growth and “somewhat elevated” inflation as reasons for maintaining the current stance.

Despite a robust Q2 GDP reading of 3%, Powell emphasised the need for caution, particularly amid uncertainty surrounding Trump’s tariff policies.

Markets reacted with disappointment, as hopes for a dovish pivot were dashed. Powell remained non-committal about September’s outlook, reportedly stating, ‘We have made no decisions about September’.

With inflation still above target and political tensions rising, the Fed’s wait-and-see approach underscores its commitment to data-driven policy.

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U.S. GDP surges 3.0% in Q2 — but what’s driving the rebound?

U.S. GDP

After a lacklustre start to 2025, the U.S. economy posted a surprising comeback in the second quarter, with GDP rising at an annualised rate of 3.0%, according to data released today.

The sharp upswing follows a 0.5% contraction in Q1, catching analysts off-guard and fuelling speculation about the durability of the recovery.

📈 A Rebound Built on Consumers and Imports

At the heart of the turnaround lies a 1.4% increase in consumer spending, led by strong demand in sectors like healthcare, finance, and automotive sales.

But what really moved the needle was a dramatic collapse in imports — down 30.3%, reversing the Q1 surge and effectively boosting the GDP calculation.

While exports and business investment both shrank modestly, the overall picture was buoyed by domestic strength and favourable trade math.

💰 Inflation Retreats — Temporarily?

The Personal Consumption Expenditures (PCE) Price Index, a key measure of inflation, ticked up just 2.1%, down from 3.7% in the previous quarter.

The Core PCE, which excludes volatile food and energy prices, landed at 2.5%, easing pressure on the Federal Reserve to act aggressively.

Yet policymakers are watching warily. A surge in tariffs—particularly those scheduled for August—could distort prices and consumer behaviour in the months ahead.

🧠 Fed and Market Implications

The GDP bounce gives the Federal Reserve some breathing room, but not total confidence. Investment weakness and subdued export activity could signal structural fragilities beneath the headline growth.

With tariff uncertainty, election-year dynamics, and a cautious jobs market all in play, rate policy may stay frozen until the economic picture becomes clearer.

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Are investors saying it’s time to move on from tariffs and if so to what effect on the markets?

Tariffs and the Markets

It looks like investor sentiment is shifting away from obsessing over tariffs—though not because they’ve disappeared.

Instead, there’s a growing sense that tariffs may be settling into a predictable range, especially in the U.S., where President Trump signalled a blanket rate of 15–20% for countries lacking specific trade agreements.

Here’s how that’s playing out

🌐 Why Investors Are Moving On

  • Predictability over Panic: With clearer expectations around tariff levels, markets may no longer treat them as wildcards.
  • Muted Market Reaction: The recent U.S.-EU trade deal barely nudged the S&P 500 or European indexes after moving the futures initially, signalling tariffs aren’t the hot trigger they once were.
  • Economists Cooling Expectations: Revisions to tariff impact estimates suggest future trade deals might not generate outsized optimism on Wall Street.

📈 Effects on the Markets

  • Focus Shift: Investors are turning to earnings—particularly from the ‘Magnificent Seven’ tech giants—and macroeconomic data for momentum.
  • Cautious Optimism: While stocks haven’t rallied hard, they’re not dropping either. Traders seem to be waiting for a new catalyst, like U.S. consumer strength or signs of a bull phase in certain indexes.
  • Geopolitical Undercurrents: A new deadline for Russia to reach a peace deal and threats of ‘secondary tariffs’ could still stir volatility, depending on how global partners react.

So, in short tariffs aren’t gone, but they’ve become background noise. Investors are tuning in to the next big signals.

If you’re keeping an eye on retail, tech earnings, or commodity flows, this shift could have ripple effects worth dissecting.

Market moving events, other than tariffs

DateEvent/CatalystMarket Impact Potential
July 30Meta earnings + possible stock split📈 High (tech sentiment)
July 31Fed meeting📈📉 High (rate guidance)
Aug 1U.S.–EU tariff milestone, not flashpoint📉 Moderate (sector recalibration)
July 22U.S. AI Action Plan (released)📈 Unclear (dependent on execution
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Markets rally as EU–U.S. trade deal eases some tariff tension

U.S. EU tariff trade deal

European and American financial markets rallied following the announcement of a new trade pact between the EU and the U.S on Sunday 27th July 2025., easing months of escalating tensions.

The deal introduces a 15% tariff on most EU exports to the United States—well below the previously threatened 30% rate—providing greater predictability across key sectors.

Global markets surged on Monday following the announcement of a landmark trade agreement between the European Union and the United States, announced by President Donald Trump and European Commission President Ursula von der Leyen at Trump’s Turnberry golf resort in Scotland.

The deal imposes a 15% tariff on most EU exports to the U.S., significantly lower than the previously threatened 30% rate.

It would appear that Trump’s global tariff rate will end up between 15% – 20%

While still a sharp increase from pre-2025 levels—when many goods faced tariffs under 3%—the agreement has been hailed as a pragmatic compromise that averts a full-blown transatlantic trade war.

In exchange, the EU has reportedly committed to $750 billion in U.S. energy purchases and $600 billion in investment into the American economy, with further spending on military equipment also expected.

European negotiators secured zero tariffs on strategic goods such as aircraft components, select chemicals, and semiconductor equipment

Strategic exemptions for aircraft components, semiconductors and select chemicals help preserve supply chain efficiency, while agricultural and consumer goods will adapt to the new rate over time.

In return, the EU has reportedly committed to over $1.3 trillion in investments focused on U.S. infrastructure, renewable energy and defence technologies.

Investors responded positively to the agreement as futures surged

  • The FTSE 100 futures hit 9,172 overnight
  • Euro Stoxx 50 futures rose 1.3%.
  • DAX hit overnight futures high of: 24,550
  • S&P 500 and Nasdaq Tech 100 hit overnight futures highs of: 6,422 and 23,440
  • Wall Street’s major indices extended futures gains, boosted by trade optimism and tech strength.

However, European stocks trimmed back ‘futures’ gains after the opening bell.

While some concerns remain over unresolved steel and pharmaceutical tariffs, analysts view the pact as a turning point that restores confidence.

The deal sets the stage for further cooperation on digital standards, regulation and intellectual property later in 2025.

This step toward economic stability is expected to foster stronger ties and benefit export-driven industries across both regions.

Trump is getting his deals, but how good are they really?

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Trump’s self-imposed August tariff deadline looms

U.S. Tariffs

Since a little after Donald Trump’s declaration of ‘Liberation Day’ and renewed tariff threats, global markets have shown a remarkable degree of indifference.

While equities dipped briefly in April, investors appear increasingly unshaken by the looming 1st August deadline.

Several factors underpin this resilience. First, market participants have grown accustomed to political brinkmanship.

Traders now view tariff announcements as bargaining tools rather than certainties, adopting a wait-and-see approach before pricing in long-term consequences.

The episodic nature of past trade spats has dulled their impact, especially without immediate legislative backing and with Trump often pulling back last minute or extending deadlines.

The media have labelled this … TACO!

TACO – Trump Always Chickens Out: Definition – A satirical acronym coined by financial commentators to describe Donald Trump’s predictable pattern of announcing aggressive tariffs, then softening or delaying them under market pressure.

Second, economic fundamentals remain firm. Corporate earnings continue to surpass expectations, and key indicators—such as job growth and consumer spending—suggest sustained momentum in major economies.

As a result, the tariff narrative has taken a back seat to earnings reports and central bank manoeuvres.

Third, diversification strategies have matured since the 2018–2020 trade wars. Many multinationals have already restructured supply chains, buffered risk through regional trade agreements, and hedged exposure to volatile sectors.

This strategic evolution makes markets less sensitive to unilateral tariff threats, especially if they lack multilateral support.

Analysts note that Trump’s rhetoric still carries weight politically, but the financial world operates on evidence, not headlines. As one strategist quipped, ‘Markets don’t trade on bluster; they trade on impact’.

That’s all very well – but markets can be fickle and reflect sentiment too.

With investors focused on earnings and monetary policy, tariff drama may remain background noise—unless policy becomes policy.

Until then, the markets seem content to roll with it!

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U.S. inflation ticks up in June 2025

U.S. inflation

As of June 2025, the U.S. annual inflation rate rose to 2.7%, marking its highest level since February 2025.

This uptick was largely driven by new tariffs imposed by President Trump, which increased costs on goods like furniture, clothing, and appliances.

On a monthly basis, U.S. consumer prices climbed 0.3% from May to June, up from a modest 0.1% increase the previous month.

📊 Core inflation—which excludes food and energy—also edged up to 2.9% year-on-year, with a 0.2% monthly increase, suggesting underlying price pressures are building.

Summary

📈 Headline CPI: rose 2.7% year-over-year

🔍 Core inflation (excluding food and energy) climbed to 2.9% annually

📊 Monthly increases: 0.3% for headline CPI, 0.2% for core inflation

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Markets appear to dismiss Trump’s tariff threats – but will this prove to be unwise?

Super Chicken

Despite President Donald Trump’s renewed push for sweeping tariffs, global markets appear unfazed.

Trump issued letters to 14 countries – including Japan, South Korea, and Malaysia—outlining new import levies ranging from 25% to 40%, set to take effect on 1st August 2025. More letters then followed.

Yet, major indices like the FTSE 100 and Nikkei 225 barely flinched, with some even posting modest gains.

So, who’s right—the president or the markets?

Trump insists tariffs are essential to redress trade imbalances and bring manufacturing back to the U.S. The EU also faces higher tariffs.

He’s floated extreme measures, including a 200% tariff on pharmaceuticals and a 50% levy on copper.

His administration argues these moves will strengthen domestic industry and reduce reliance on foreign supply chains.

However, investors seem to be betting on a familiar pattern: Trump talks tough but ultimately softens under pressure. Analysts have dubbed this the ‘TACO’ trade—Trump Always Chickens Out.

His own comments have added to the ambiguity, calling the August deadline ‘firm, but not 100% firm’.

The economic logic behind the tariffs is being questioned. Tariffs are paid by importers—often U.S. businesses and consumers—not foreign governments.

This could lead to higher prices and inflation, especially in sectors like healthcare and electronics. Some economists warn of recessionary risks for countries like Japan and South Korea.

In short, markets may be right to remain calm—for now. But if Trump follows through, the impact could be far-reaching.

With trade negotiations still in flux and only two deals (UK and Vietnam) finalised, the next few weeks will be critical. Investors may be wise not to ignore the warning signs entirely.

Whether this is brinkmanship or a genuine shift in trade policy, the stakes are high—and the clock is ticking.

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Elon Musk launches ‘America Party’ amid ongoing feud with Trump

America Party

In a dramatic twist to the U.S. political landscape, Elon Musk has announced the formation of a new political party, the America Party, following a bitter fallout with President Donald Trump over his controversial tax and spending legislation – the ‘Big Beautiful Bill‘.

Musk, once a key ally of Trump and head of the Department of Government Efficiency (DOGE), broke ranks after the passage of the so-called ‘Big Beautiful Bill‘, which Musk labelled a “disgusting abomination” that would balloon the national debt by trillions.

On U.S. Independence Day, Musk polled his followers on X, asking whether a new party should be formed. With a 2-to-1 majority voting ‘yes’, Musk declared, ‘Today, the America Party is formed to give you back your freedom’.

The party aims to challenge the entrenched two-party system by targeting a handful of swing Senate and House seats, potentially becoming a decisive force in future legislation.

Musk has pledged to support primary challengers against Republicans who backed the bill, accusing them of betraying fiscal responsibility.

Trump, clearly irked, dismissed Musk’s move as ‘ridiculous’, reportedly stating, ‘It’s always been a two-party system… third parties have never worked’.

He added on Truth Social, ‘Elon Musk has gone completely off the rails… becoming a train wreck over the past five weeks’.

The feud has escalated rapidly, with Trump threatening to revoke federal subsidies for Musk’s companies and even suggesting deportation, despite Musk’s U.S. citizenship.

While Musk’s America Party faces steep legal and logistical hurdles, his immense wealth and online influence could make it a disruptive force.

Whether it gains traction or fizzles out remains to be seen but it’s clear the ‘love’ between Musk and Trump is officially over.