At the end of March, Donald Trump had a phone call with Mark Carney, the new Prime Minister of Canada, a financier who replaced Justin Trudeau at the helm of the government.
Right after taking office at the White House, the American president attacked the country to the north, stating that he would do everything in his power to become the 51st American federal state.
Trump caused a diplomatic rupture between the US and Canada, as well as critical reactions from citizens of both countries.
The assault by the new American administration was even harsher, with Canada being the first to fall victim to the imposition of 25% tariffs on products imported from the US.
The decision led to retaliatory actions from the Canadian government, which removed a series of American goods from store shelves and imposed tariffs on products imported from the US.
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For two months, in several public statements, Trump continued to attack Canada, stating that it would be conquered by the US. The White House's assault abruptly ended on March 28, following the phone call between Carney and Trump.
From that moment on, the American president did not make any public references to the neighboring country and did not mention his goal of conquering it anymore.
"Donald Trump respects Canada's sovereignty," stated Prime Minister Mark Carney immediately after the discussion.
"I think things are going very well between Canada and the US," added Donald Trump.
How did Trump lose interest in Canada?
To silence the American president, the Canadian finance-minister used a lever that, most likely, Trump knew little about.
When he learned about the possible consequences, he lost interest in conquering the neighboring country.
Canada holds US Treasury bonds worth $541 billion. It is the second nation after Japan in terms of this type of portfolio. The value of US federal bonds owned by foreigners amounts to a staggering $31.288 billion.
A massive sale of these bonds by an entity holding a significant amount would lead to a rapid devaluation, followed, at the limit, by a possible collapse of the American and global financial system.
To send a signal to Trump, Canada sold bonds worth $3.5 billion in March, amid the crisis triggered by the White House, a small amount, more of a political signal, understood by Trump in the meantime.
The Economic Nuclear Winter
The impulsive behavior, aggressive diplomacy, and bombastic presentation are used by the American president to draw attention to an issue he aims to resolve. If he fails, which is generally the case, he moves on to another issue that he approaches just as aggressively and noisily, causing a new crisis.
Such an approach, more visible now than in the first term, because he still has major political support in both chambers of Congress and is surrounded by yesmen in his Cabinet, has two major consequences: the isolation of America and the loss of trust in relation to other states, a trust that the US has cultivated and promoted consistently for the past hundred years.
Today, less than 100 days into Donald Trump's second term, many political commentators, journalists, and experts wonder why the Republican leader had such strong support, not from the representatives of the MAGA movement, but from the vast majority of Wall Street investors, bankers, the American financial and business elite, the military, lawyers, judges, most of whom are now horrified by Trump's behavior and the danger he poses to the world?
"We are entering the most pro-growth, pro-business, pro-American administration that we have probably seen in my adult life," announced Bill Ackman in December of last year. Ackman is one of the most successful investors in the world, a billionaire at the helm of a major global investment fund.
On April 7, after Trump triggered the global tariff storm, Ackman came back and said that "we have entered an economic nuclear winter."
If a professional who handles the money and destinies of hundreds of thousands of people, who has access to information, analysis, and expertise from the most skilled finance specialists, fell into Donald Trump's trap, what can be said about the rest of his supporters.
Who Buys Stocks?
Peter Berezin, the chief strategist of BCA Research, an institute that produces economic reports for the most important banks in the world, was among the few who, in November, immediately after Trump's victory in the elections, published a study concluding that the chances of a global economic recession had increased to 75% due to the tariff policy promoted by the new American president.
His work was more of an exception, noticed only because it had the endorsement of the important research institute, not being taken seriously by investors at that time.
"The prospect of an escalation of the trade war is likely to affect corporate investments, while also reducing the real disposable income of families," Berezin wrote at the time, but no one believed him.
He argues that Wall Street investors, bankers, and investment fund managers supported Donald Trump because "stock market professionals have exactly the same cognitive biases or even greater ones than amateur players on the stock market, as the former face a high risk of ending their careers if they oppose the prevailing trends."
In other words, Berezin argues that a pessimistic trader cannot be successful in selling stocks, being obliged and trained to align with dominant trends, which in most of the time, in stock trading business, are optimistic ones.
A pessimistic person, meaning one who does not believe that things will be better in the future than they are now, does not buy stocks, being convinced that such an investment is detrimental.
Stocks are bought only by optimists, meaning people who bet on a prosperous future that will increase their value.
The Emperor Was Naked
The signs of the disaster that was to come with Trump's return to the White House were always there, in his first term when he went through two impeachment processes, in his election campaign where he talked about bringing peace to Ukraine within 24 hours, offering too few details about the ways and nature of the conflict, they were there when he announced from the campaign podium that tariffs were the magical solution to save America.
Unfortunately, according to Berezin's theory, only pessimists saw the signs, while the economic growth of the US, the decrease in unemployment, positive company reports created an optimism that refused to see that the emperor was naked.