Trump’s unconventional and unpredictable leadership may affront many. Yet dismissing it as chaotic overlooks what appears to be a deliberate strategy. His actions disrupt, reframe, and reset the terms of engagement, often catching others off guard. For global financial organisations and policymakers, success will lie in looking past the noise to focus on the opportunities and risks his approach creates.
Trump’s negotiating style thrives on disruption. He introduces bold, seemingly outlandish proposals to force counterparts to reassess their positions. The Greenland proposal is a clear example. On the surface, it seemed implausible, but it revealed broader priorities, such as limiting China’s influence in the Arctic and securing U.S. access to critical resources. This was less about acquiring territory and more about reshaping the strategic conversation.
This approach extends to his domestic policies. Trump often signals dramatic measures, as seen with his tax cut proposals. While his rhetoric may sound extreme, the outcomes are typically more measured. In today’s inflation-sensitive environment, sweeping tax cuts risk economic destabilisation, but that is not his aim. Trump recognises that high inflation and a declining market are not victories. His rhetoric may provoke, but his endgame hinges on balancing ambition with practicality.
Financial markets reflect this tension. Post-election, markets rallied on promises of deregulation and corporate tax reduction fuelling growth. However, as inflationary concerns mount, rising bond yields and the dollar have injected more uncertainty into forecasts. Restricting the labor market by over-constraining immigration and aggressively imposing tariffs fuels inflation. The Fed is becoming increasingly wary, and the rising U.S. dollar reflects investor concerns about the scope for future rate cuts. A strong dollar erodes the competitiveness of American businesses abroad and the challenge for the Trump administration is to sustain growth without driving inflation higher. For policymakers abroad, the challenge is to avoid the imposition of trade tariffs maintaining access to the U.S. market and attract continued U.S. investment to bolster their own economies. Trump believes there is a deal to be made, and if so, all could benefit.
For financial organisations, the key lesson is adaptability. The liberal global order, long a cornerstone of economic growth, is under strain. Rising costs from sustainability policies, increasing regulation, and the rapid adoption of AI are creating uncertainties for businesses and households alike. Trump’s rhetoric resonates with the uncertainties and frustrations people are feeling, and other political leaders worldwide are either following his lead or adapting to the evolving global dynamics he is shaping.
My own experience in navigating unpredictable government policies has taught me that while complexity and risk increase, so do opportunities for creativity and success. In China in the early 2000s, I introduced the A50 index. When the authorities changed the rules and promoted a homegrown alternative in place of the A50, we pivoted. By launching an ETF and futures contract on the index in Hong Kong and Singapore, we created vehicles that remain highly active today.
Of course, there is no certainty that Trump will succeed, and many would prefer to see him fail. His unorthodox methods make predicting the future even harder, creating a world full of uncertainty and risk. But they also create opportunities for innovation, collaboration, and growth. Effective leaders will look beyond his provocations, focusing instead on his objectives. They will read the signals, not just the words, and align their strategies with broader global dynamics. Leaders must be bold but measured, seizing opportunities while managing risks.
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