Economic Roulette

How Trump’s Trade Play Is Backfiring—and Boosting Bitcoin

Twenty-two days ago, President Trump loaded his policy gun. But instead of taking aim at rivals, he spun the barrel and triggered a game of economic roulette. And it's already blowing back.

Market Fallout

Since then:

• U.S. 2025 growth forecasts have been cut in half.

• Gold is up 31% YTD, echoing crisis-era surges from the 1970s and 1930s.

• The 10Y Treasury yield and USD have decoupled at a historic rate.

• U.S. equities have slipped into a bear market. Treasuries? Flat YTD—no safe haven bid.

On Tuesday, Trump backed off his plan to terminate Jerome Powell, after branding the Fed Chair "Mr. Too Late, a major loser."

“If I want him out, he’ll be out of there real fast, believe me.” – Trump, April 18 (AP)

Mixed Signals in the Market

We’re seeing wild crosscurrents. Gold leads all assets YTD. Bitcoin leads MTD. And some days—like today—both gold and the S&P are up big: +1.7% and +2.3%.

We see gold and bitcoin as the signal with the recent equity rally just a result of chop from the ever-shifting rules on trade that foul models and reduce visibility.

The Tariff Hangover

The fallout from Trump’s tariff blitz is just starting to show up in the data:

• New home sales fell -5.9% in March vs. -3% expected, lowest since 2022. And that’s March—April’s pain hasn’t hit yet.

• IMF cut global growth forecasts to 2.8% (2025) and 3.0% (2026), down from 3.3%.

• These are well below the 2000–2019 average of 3.7%—dangerous in a debt-heavy world.

• U.S. 2025 GDP was cut to 0.9%, down from 1.8% in January. That’s half the global rate.

Deutsche Bank is out with an S&P 500 earnings downgrade: