It felt so real. I am sure in April we saw the culmination of Trump 2.0, with the repudiation of the trading and security order that existed since the end of World War II. I am sure the two largest economies in the world entered divorce proceedings, and are now in the process of trying to work out who gets what assets, and visitation rights. It felt real at the time, but now today, it feels so much a fever dream.
If I was to push a bullish argument - then the Ukraine policy was pushed to get the rest of the world to spend more militarily and tariffs were pushed to get the rest of the world to spend more domestically. Both policies were aimed at getting foreigners to buy more American goods. If I just focused on these two aspects, then this is bullish - and you should buy equities - and you could point to current equity markets as proof. Certainly, the US trade deficit has exploded higher, so unless their is a recession in the US, you need much more foreigner buying.
For me, where markets went wrong in April was the assumption that there would be a recession, and the Fed would cut rates.
