In case anyone felt like disagreeing, the gold price - which is often seen as a measure of how anxious investors are feeling - has hit 25 record highs already this year, ranking 2025 third in terms of total of gold price spikes since 1968.
This is according to data from the Royal Mint, which also reported that in 2024, gold hit 40 peaks in total. This means that in less than four months, investors have sought out ‘safety’ at a lightning-fast pace.
We have had indications that Donald Trump might soften his tone when it comes to China and unconfirmed reports that the latter might exempt certain US imports from tariffs. Well confirmed by Trump and no one else as of yet.
‘Phew’, many have said, but I say take a breather, get a grip and stop being grateful for a crumb of confidence from the White House – it will not last.
In my opinion, I do not think investors should take the lull as anything other than that or pin hopes that Trump has ‘seen sense’ or is suddenly taking on sage advice.
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: “There is plenty to be sceptical about.
“Trump’s stance on geopolitics is still unnerving for investors; he has shown he is happy to rip up deep alliances and provoke severe trade spats with neighbours. His team are decimating government departments which could also have social and economic repercussions down the line,” she added.
“Financial markets are adjusting to Trump’s modus operandi, which is to speak and act impulsively and then retract some moves later.”
I do not fully agree here. Not that this is not the way Trump operates, but the idea that markets did not know this before.
Trump has never made his dislike of China a secret – we have known that since his first term – or his feelings that the rest of the world does not pay its fair share, or that he approaches economics with his business ‘deal making’ hat on.
The president has shown his true colours many times, and being grateful for a scrap of common sense should not be enough to satisfy markets. In a similar but different example, people did not wait for former UK prime minister Liz Truss to mess things up a second time when she showed just how badly she could do it once. That trust was broken and irreparable.
“Just how deeply the markets are scarred and how long it will take to heal the reputation of the US remains to be seen and investors are likely to stay jittery as trade negotiations play out,” Streeter continued.
It is not just the markets that are reeling; everyday Americans are losing steam with the Trump administration as well.
In the most recent Harvard Harris poll, ‘tariffs and trade policy’ and ‘handling inflation’ were the president’s lowest scoring areas, all while the latter remains the top concern for people right now.
I asked Russ Mould, investment director at AJ Bell, about this earlier in the week and whether markets are asking too little from Trump when it comes to reassurance. He agreed that no one, arguably not even Trump himself, knows what is coming next – given the impressive amount of backpedalling he’s done recently.
Mould said: “The lack of clarity on the White House’s goals, and whether it is seeking income from tariffs to fund tax cuts or a reduction in the trade deficit or to boost domestic output and jobs, is not a help and explains why investors seem to be less willing to buy dollar-denominated assets, be they shares or US government bonds.”
HL’s Streeter echoed a lot of this and told me that “hopes for a reprieve in the trade war have led to a small swell of investor confidence, but there is still a long way to go to repair the damage wreaked by the Trump administration”.
I sympathise with the quandary that most investors face. The US has been the place to be and now, that market is burning most so badly, and any relief from the heat sparks a surge back into what they have always known.
But investors and fund managers especially should not be pinning their investment case on the ‘hope’ that Trump reneges on his plans just because that seems like the sensible thing to do when we have been shown, repeatedly, that just because the market wants it, it does not mean it will be so.
We are not even 100 days into Trump’s second term and, as it stands, investors will have to deal with four more years of paper-thin reliability when it comes to the US.
I said in my Friday Briefing a few weeks ago that 2 April marked the US peak and I am no means calling myself the oracle or claiming that that is a non-consensus view right now.
I just think the past three weeks have confirmed this even further or rather, Trump’s actions should mean the end of the US’ exceptional run.
The risk of Trump going back to his ‘Liberation Day’ policy peak or something else that could cause peril for markets and economies, US and others alike, is not zero. In fact, I would argue it is much higher than that.
And that, frankly, is a big risk to take with your money.
