Is this the main purpose of Trump's duties? “One third of the USA debt is collapsed during the year”
Donald Trump, returning to the White House, focused on a sharp customs game, which in the first weeks of 2025 caused a shock on global markets. One of the key elements of this strategy – as Kozłowski emphasizes – is “Department of USA Administration”, consisting in consciously increasing uncertainty on the stock markets to support the demand for American tax bonds.
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– One third of the American debt is collapsed in the next 12 months. If a large part of the debt falls and the profitability is high, then the administration is trying to do a lot to increase uncertainty. The point is for investors to buy more American bonds. Now, more or less the profitability of American 10-year-olds amount to 4.3 percent. This is relatively high. And it seems that the administration makes a certain plant to support American bonds at the expense of American actions. He wants their profitability to fall, to refinance cheaper for the coming years. And this will have a significant impact on the budget deficit. Currently, the budget deficit is about 6 percent. That's a lot – he said.
Customs as a tool for the fight for the advantage
Trump does not hide that his customs policy aims to “make America great” – by protecting national industry, limiting the trade deficit and putting pressure on trade partners, especially China and the European Union. In April, he introduced a universal 10 % tariff for all goods imported to the USA, and for countries with the largest trade deficit-including China (34 percent) and the EU (20 %)-the rates are much higher. In addition, 25 % duties were applied to cars and automotive parts.
Kozłowski emphasizes that administration is not just about the debt question. He explains that “the preparing that Trump increases the duties, among others, that The United States has a permanent current deficiti.e. they spend more than they sell, and China has a larger or permanent surplus. And this causes such a clash of two large economic blocks. “
In his opinion, the game also takes place in the commercial and technological arms race. – The United States is starting to lose the technological race in several areas. And now there is one of the latter chances to fight for position, maintaining the hegemon position in global terms. Will it work? Time will tell. The Chinese also see that this is one of the last moments – he admitted.
Not the end of declines?
The introduction of duties caused a rapid discount on American stock exchanges – technology companies from the NASDAQ index have suffered. According to Sobiesław Kozłowski, the biggest declines can be behind us, but the quotations, although slower, can still melt. – We have a very clear discount, for example Nasdaq or S&P. And a strong blow to NASDAQ growth companies. Is this the end? It seems to me that probably not yet, in the sense that there are new risk factors – he assessed.
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