Trump Says Nevermind (Again), Markets Say: Whatever

Trump’s at it again—changing his mind, like he always does. This time, he said he never planned to fire Fed Chair Jerome Powell and also mentioned a possible trade deal with China. Sounds positive, right? The markets reacted a little—gold dropped, the dollar bounced—but overall, no one’s really taking it too seriously.

Why? Because this isn’t the first time. And probably not the last either.

Trump Talks, Markets Shrug

Back when Trump was president, he often used “we have a deal” or “we had a great call” to boost market confidence whenever things got shaky. Now, he’s doing the same. As stocks, bonds, and the dollar faced pressure recently, he toned things down—probably to avoid a market crash. After all, he doesn’t want the stock market, which he’s always taken credit for, to tank under his watch.

But markets have learned. They know his words can flip overnight. So instead of reacting strongly, investors are looking for safer places to park their money.

What Investors Really Care About

Let’s break this down:

• Tariffs: High tariffs are probably here to stay. That’s still a big deal for global trade and market confidence.

• Trade deals: Even if one is signed, people aren’t sure how long it would actually last.

• Powell being fired: Honestly, most investors don’t care much. His term ends in early 2026 anyway. And last time Trump pushed him on interest rates, Powell gave in. So markets assume the Fed won’t go totally off-track, at least for now.

• Rate cuts: The Fed isn’t rushing to cut rates yet. They want to see more data first. But when cuts come, they might be bigger.

So for now, markets believe this: rate cuts are coming, just not yet—and probably in a big way when they do. But trade uncertainty? That’s still a big worry.

What’s Happening with U.S. Assets?

Now let’s talk about different types of U.S. assets:

• Treasuries (U.S. government bonds): Even though some say foreign investors are selling, yields (aka interest rates) on 2-year and 10-year Treasuries are still falling. That means people still see Treasuries as a safe place to be. Markets trust that the U.S. government and the Fed will step in if needed.

• The dollar: This one’s tricky. Trump wants a strong dollar globally, but in trade talks, he wants other currencies to get stronger. At the same time, countries hit by tariffs may want their currencies to weaken to stay competitive. So it’s unclear where the dollar goes next—and the usual dollar index (which compares the dollar mostly to the euro, yen, and pound) may not tell the full story.

• U.S. stocks: This is where things get messier. Big tech stocks have been hit the hardest. Why? Because economic forecasts are getting worse, and higher bond yields make expensive growth stocks less attractive. There’s also a chance that some foreign investors may pull money out of U.S. stocks, though that’s still uncertain.

At the end of the day, stock performance will depend on how the U.S. economy and listed companies actually do. And that won’t be clear until after we see what happens with tariffs and trade talks. The current “90-day” deadline probably won’t be the last round.

In short: Trump changed his mind again—but it didn’t make markets feel any safer. Investors are still looking for safer bets, like gold. And for now, U.S. assets (stocks, bonds, the dollar) are heading in different directions. That split might just become the new normal.