Is President Donald Trump as incomprehensible as many anti-Trump mainstream media have portrayed him? My opinion is that he knows what he is doing, but his approach is too results-oriented, impetuous and frequently follows impulses.
With the US stock markets falling since October, Trump, an experienced businessman, realises that a bear market is approaching and that the US economy is not as strong as he has been bragging it is.
The Federal Reserve Bank has just announced that the interest rate is now next to neutral, sending a message that the interest rate is unlikely to rise at the same rate it had previously pledged. Other economic and industrial data are not encouraging either.
General Motors has just announced it is cutting 15 per cent of its salaried workers and shutting five plants in North America. Shares of General Electric, once a formidable multinational conglomerate, has dropped to a nine-year low to $8 (Bt263). There are also warning signs in the housing market because real-time price growth is locked in a cyclical downturn.
The president has probably figured out by now that his trade war with China is adding fuel to the fire. It will only worsen the economy.
Following Peter Navvaro’s “Death by China” argument, the US could have won the trade war against China if Trump was president two decades ago. Now, the Chinese economy is too big and too sophisticated for the US to engage in economic warfare.
As any sign of a recession in the next two years will dash Trump’s hope of winning a second term. What would be easier for him to do is calm the stock market, shake hands with his “good friend” President Xi Jinping this weekend at the G20 dinner and find a face-saving way to announce there will be no more trade wars.