Will markets ever care about anything?

Pushkin. Geopolitics are getting more and more personal. You want a decent trading and diplomatic relationship with the USA? Well then, you better get along nicely with the big man, Donald Trump. Not his underlings, not his outriders, but the man himself. The same goes for big business. Suddenly the president is very publicly receiving shiny gifts and promises of big payments to the federal government from companies that want to stay on his side. This all feels rather unfamiliar for that shining city on the hill, the home of capitalism itself, the USA. And it means that it really pays to understand what Trumpism really is. Now then, Rob Armstrong and I, we know what we don't know. So today on the show, a treat, a geopolitical pointy head who actually understands how the world works. I hope. This is Unhedged, the markets and finance podcast from the Financial Times and Pushkin. I'm Katie Martin, a markets columnist and mere mortal at the FT in sunshiney London. And I'm joined first of all by normal man Rob Armstrong from the Unhedged newsletter in New York City. Rob, say hello. I'm so excited that Gideon is here. If he doesn't know it, it can't be known. Thanks for the heavy sarcasm, Rob. It's true, man. Politics is a mystery to me and I'm glad you're here to help. Well, that's it, listener. We've found you someone who really knows their geopolitics, thunderous FT world affairs commentator and pointy head, Gideon Rachman. My head's obviously not literally pointy. In fact, I think I would say I'm surprisingly lowbrow, but I will try to be pointy headed in principle. Raise the tone here, Gideon. Raise the tone. Now then, how often do people ask you what the guiding principles of Trumpism really are? And are you any closer to an answer? Well, actually, they ask me surprisingly rarely, or they don't put it quite that way. It's more like, what the hell is going on? Because Trumpism is such a blizzard of apparently kind of unconnected stuff. I've almost decided, I've got to keep a list of the things he does, because there's so many. But I mean, if I had to answer that question, what would I say? I think a lot of it is vague instincts of Trump, which is why it's so hard to turn into coherent ideology. You can say there are things that appeal to him. He likes tariffs. He likes other strongman leaders. He likes Xi. He likes Putin. He likes kind of macho leaders who are perfectly democratic, like Alexander Stubb, president of Finland, who plays golf very nicely. So there's those kind of personalized stuff. And I think he also likes things that make him look good. And he's almost sort of childly, like open in wanting certain things, like the Nobel Peace Prize, which most people might think is kind of faintly ridiculous. And even if you sort of lie awake at night thinking, it'd be really cool if I got the Nobel Peace Prize. You don't like say it every other day. But no, he's driven by ego and he's driven by instincts. And I think that's sort of it. Yeah. I can't agree more completely with that. The question I always ask myself about this guy is, what is the thing for which he would make a sacrifice of personal or political or media capital? For what is Trump willing to absorb pain? And I still don't have an answer to that question. Well, I think that's almost a principle for him, that he thinks there's nothing worth making a sacrifice for. I mean, he disputes having said it, but famously he is meant to have called the American soldiers who were killed, I think at D-Day, suckers. He said, why would I have visited their cemetery? Trumpism on that reading can be summed up as, don't be a sucker. Don't be a sucker. But look, so we can point to a few countries where we can see this very, I'm going to say, mercurial approach really play out. So for example, Pakistan, he seems to get along with quite famously. Pakistan is very good at flattering Trump, saying he should get the Nobel Peace Prize, yada yada. Whereas he's really taken umbrage at countries, including Brazil, India, and of all people, Switzerland. The Swiss go out of their way, not to annoy people, but they have annoyed Donald Trump. Yeah, I think they're a bit astonished by that. I mean, Brazil is obviously easier to explain because he's very matey with President Bolsonaro, former President Bolsonaro, who is accused of having failed to accept losing a presidential election and then encouraging his followers to storm the Congress and is on trial for that. And something about that really annoys Trump, the idea that this guy would go on trial for that. So you can see that he's going after Brazil for that. That I can explain. Switzerland, I mean, I suppose he wouldn't be the first person to find the Swiss sort of annoyingly smug. But I think that it's more that the Swiss are just not able to deal in a sort of way that General Muneer of Pakistan is able to show up at the White House and say, okay, what kind of a deal do you want? Sure, I'll nominate you for the Nobel Peace Prize. And you know, Wittkopf's son is doing crypto deals with us, and in fact came to see me. It's all very personalized. It's not very rule based. Switzerland is almost internally the most democratic country in the world. Everything's put to a referendum. There are loads of cantons. It's very, very law abiding, as you would hope you would want for a big financial center. And so it's hard for them to say, just turn up and say, sure, what do you want? We can do that. As a result, Swiss tariff, I believe, writes in saying 39%. Yeah. There is a kind of hatred of process, just for being process in the Trump administration. There is a sense that these systems or structures are an affront to peace, justice and the American way. But it seems to me that these processes and these structures that at least once characterized global affairs, that's what makes it possible to predict how the future is going to play out. I mean, my question for you, Gideon, is do we now know nothing, whereas before we knew a little about what the future of global politics are going to look like? Are we just utterly at sea now that the biggest and most powerful country in the world just rejects all the normal structures by which the system used to work? I think we're even more at sea than we were before, because the fact that the US adhere to certain basic principles that it itself had helped to put in place after 1945 was a constant in a very uncertain world. I mean, obviously, the big geopolitical shocks, there have been plenty and they all tend to be things that come at you from totally nowhere, you know, 9-11, what the world changes one day to the next, or I don't know, going back further back, Saddam Hussein suddenly invades Kuwait. The idea of a world changing event that happens very quickly and makes you rethink that does happen. But this, in a way, was something that nobody would have anticipated because we thought we understood America's conception of democracy and the rules that would operate under and that there were limits to its foreign policy. There were certain bipartisan commitments that America would be more or less behind, unless there was a revolution and perhaps there just has been one. Turns out those limits are not really written down and if they are, writing things down is boring. There's a lot of just things that turned out were just like norms and conventions. Completely, which is why the American system has been less robust than we thought it might be, because a lot of it relied on what the British call the good chap theory of politics, that people wouldn't do that because that would be really disgraceful. Because it simply isn't cricket. Yeah, exactly. It's deeply unpredictable, but in a funny way, I mean, you guys have made a place to comment on me, I wonder whether in a way the unpredictability now is almost like a stabilizer for markets because Trump can do something outrageous and then people get the idea, oh, well, it'll probably change his mind in 10 days time. Some guy called Rob something or other coined this thing, the taco trade, Trump always chickens out. My worry is that he doesn't necessarily always chicken out anymore. He's like Switzerland, 39 percent whack.