- The Trump Administration spews a lot of hot air about trade deficits and terrible trade deals, but, in practice, limits itself to the enforcement of existing agreements and the very public lobbying of American businesses. In the process, we alienate the rest of the world and forfeit our ability to lead, but we don’t do any lasting harm to the world economy.
- The trade war actually becomes a reality as Trump rips up NAFTA and the WTO in a completely fruitless effort to eliminate deficits. Markets tank all over the world.
So which will it be? As of today, the smart money would be on #1, but it’s early.