Trump’s tariffs are a game of snakes and ladders

We’ve had a dramatic start to the year – DeepSeek’s disruption of the artificial intelligence (AI) narrative, a seismic shift in defence and infrastructure spending out of Germany and of course “Liberation Day”. As a result, we initially witnessed significant divergence in performance across and within asset classes and, more recently, a severe correction.

As always, we need to take a step back to gain some perspective. We’ve talked a lot in recent years about a major shift in the investment regime driven by a rejection of the political consensus which dominated Western policy from the 1990s onwards; a focus on fiscal rectitude combined with loose monetary policy and a highly globalised economy. The challenge with this model, particularly in the 2010s as interest rates moved to zero or negative and wage growth languished, was that it didn’t work for the majority of people in western democracies. As a consequence, in recent years we