Analysis
Trump angered the American oligarchs
Kenneth Langone, co-founder of the multinational home goods supplier Home Depot, was more prosaic, calling Trump's tariffs “bullshit.”
There is an open clash between the U.S. oligarchs. After last week's stock market plunge, some of Wall Street's heavyweights came out against the tariffs: Larry Fink (BlackRock), Ken Griffin (Citadel LLC), but not only. On Monday, Elon Musk, Trump's protégé, also made his voice heard, in his own way, by posting on X a video of economist Milton Friedman explaining international value chains with the example of the production of a pencil (the wood coming from one country, the graphite from another, the metal of the ferrule from yet another, and so on).
They fear that costs for companies will increase, especially in sectors that are highly integrated into global supply chains, with declining profits and rising end prices. For the large funds, however, the main problem is uncertainty in the financial markets. Larry Fink stressed the importance of “predictability” to attract long-term investment, arguing that tariffs can undermine investor confidence in the stability of world trade. From his high perch among hedge fund managers, Citadel CEO Ken Griffin warned of “risks to the investment ecosystem,” while Kenneth Langone, co-founder of the multinational home goods supplier Home Depot, was more prosaic, calling Trump's tariffs “bullshit.”
Musk’s jitters, who has reportedly asked Trump to lift the tariffs, mirrors those of Big Tech, the technology flagships that had fallen head over heels for The Donald. They are the ones who have lost the most in recent days. According to the New York Times, the announcement of the tariffs led to a destruction of €9.2 trillion in value, more than half of the European Union's GDP. The “Magnificent 7” – Apple, Nvidia, Microsoft, Amazon, Alphabet, Meta and Tesla – lost $1.5 trillion in market value.
In particular, Apple lost $311 billion and Nvidia lost $139 billion. The reason is that these companies are highly dependent on global supply chains, which mainly start in Southeast Asia. In all these cases, we are talking about stocks that are overvalued relative to the company fundamentals. This applies to the stocks of so many other publicly traded companies as well. There is a gigantic disproportion between the “financial superstructure” and GDP in the United States. The two main stock exchanges, NYSE and NASDAQ, report a “capitalization value” (not including derivatives) in excess of $50 trillion, compared with a GDP that stands at $26 trillion. Beyond the tariffs, there is a problem with the very nature of American capitalism.
Then there are the oil producers, which have also gone critical towards the tycoon's decisions. Shale oil and liquefied gas producers need foreign markets to make their profits. At the same time, tariffs risk drawing retaliation from countries such as China, India and European countries, which are major buyers of U.S.-produced energy commodities.
However, there is no shortage of entrepreneurs and speculators who are still on Trump's side. These include Texas banker and mathematical genius Andy Beal and representatives of the Coalition for a Prosperous America (CPA), the manufacturing lobbying organization, along with Scott Bessent, who before getting the job of Treasury Secretary was a speculative finance tycoon. Bessent claimed on Sunday there was “no reason” to forecast a recession and that “the market consistently underestimates Donald Trump.”
At the political level, the Democrats are not a united front on the matter of Trump's protectionism. The party's left wing is putting forward a more complex view: Bernie Sanders has been sharply critical of the tycoon's decisions, calling them “totally irrational” and destabilizing for the world economy, but he won’t rule out that tariffs could serve a purpose if adopted in a targeted and “rational” manner. The Vermont senator's position can be summarized as follows: neoliberal globalization and the processes of financialization have hurt the working classes, both in America and in the places where production has been relocated, devaluing labor and skyrocketing inequality. Thus, tariffs, if used purposefully, could be useful as part of an overall socio-economic paradigm shift. What is not useful, however, and could lead to worse problems for workers, is economic gangsterism. A stand against both Trump and Milton Friedman, and rightly so.
Originally published at https://ilmanifesto.it/nellamerica-di-trump-va-in-scena-la-guerra-tra-oligarchi on 2025-04-09