There’s also another saying: “If you owe the bank a hundred thousand, that’s your problem, but if you owe the bank a hundred million, that’s the bank’s problem.” Debt is a good servant but a bad master when the dominoes start to fall.
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Again, Trump is causing self-inflicted uncertainty in the stock markets. The only sure thing is that these surprising and arbitrary fluctuations and tariffs do not do any good for any country’s economy. Once trust is lost, it’s difficult to get it back.
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In the video, Dr. Joeri Schasfoort discusses the leading megatrend in the global economy and how all major economies will experience a labor shortage and, consequently, a declining GDP in the future. Loans cannot be taken indefinitely, so a ceiling will inevitably be reached, which could lead to a severe debt crisis.
https://www.youtube.com/watch?v=DDEOCJvmzKo
Finland is already on this path of uncontrolled indebtedness, and we are no longer having many children, so the maximum debt ceiling and societal reorganization will be reached sooner for us than for larger economies. What will happen to the Finnish-led companies on the Helsinki Stock Exchange when the national economy turns into a downward spiral 
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Greetings! What else would one do on a beautiful summer day but spend time writing a macro overview? In the weekly macro, we discuss EU tariffs and how 100 billion was exceeded in tariff collection this year. It won’t save the federal budget, but it’s a good marketing trick for voters. Wishing you a hot continuation of summer 
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305 bankruptcies initiated in June 2025 | Statistics Finland
The real economy is not doing as well as one might conclude from the stock market boom: “305 bankruptcies were initiated in June 2025, which is 53 bankruptcies more than in the corresponding period a year earlier.”
Absolutely terrible development, it’s no wonder that housing sales are stagnant and older and older vehicles are on the road.
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CPI inflation report June 2025:
U.S. inflation rose as expected. In May, annual inflation was 2.4%, in June 2.7%.
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Here’s also a good image from Yahoo Finance, showing where inflation has accelerated and where it hasn’t (year-on-year):
- Housing costs remain stubborn, and prices rose fastest in these (energy, housing, and rents rose a total of 3.8% year-on-year). However, according to the article, the rise in housing prices is slowing down.
- Energy prices last month were naturally driven up by a short-term spike in oil prices.
- On a monthly basis, relatively fast inflation in healthcare services (0.6%), clothing (0.3%), and food (0.3%). Of these, tariffs have affected at least clothing and food.
- Prices of used and new cars decreased on a monthly basis, even though one might have thought tariffs would have hit these at least.
- Overall, inflation seems to be mainly driven by everything else but tariffs, even though inflation surprisingly moved on the upside.
Monthly data found here: https://www.bls.gov/news.release/cpi.nr0.htm, and here’s a table for those who don’t want to go to the link:
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I checked the figures again and I’m starting to get a bit worried. The Shiller P/E is near the peaks of the COVID rally, and the S&P 500 P/E is over 30.
Who could offer some reassurance in these times? 
Meanwhile, the 10-year Treasury rate is almost 4.5%. By simple math, the risk premium is negative with backward-looking figures. Central bank interest rates are unlikely to fall, as inflation is picking up in the US.
Tariffs are not shaking the stock market. TACO, or has the “eternal rise” started again?
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Indeed. I don’t remember if this was already here, but to refresh my memory, here’s an image from Seligson’s Q2 annual letter:
Now we’ve moved another notch to the right on the graph. 
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So, when it’s between 35-40, an annual return of about 2-7% is expected for the next ten years, and if Cape decreases during that time, will the expected return increase in the future?
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Pretty much so, but it’s also worth noting that it’s a nominal return, not a real return.
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For a sunny Friday, some genuine wonder about the state of the world’s stock markets (for Premium members 
).
The trade war is not over, but stock markets are already treating it as an insignificant matter. At least, this can be concluded from the rise in stock prices and reactions to recent developments in the trade war. There may be good reasons for this (such as TACO), but it leaves little room for other possible developments.
At the same time, the AI boom that took a breather in the stock market at the beginning of the year has returned to the spotlight. NVIDIA has become the first company in history to break the $4 trillion market capitalization milestone. A whopping 50% of this year’s rise in the SP500 index is explained by the AI trio, which includes Meta and Microsoft alongside the aforementioned.
Concurrently, the share of semiconductor firms has risen to over 10% of the market capitalization of US stock exchanges. This could be the beginning of a new era, as dominant sectors can often be large in the stock market for decades, just as the automotive industry once was and energy before technology. But the change has been quite rapid…
https://www.inderes.fi/articles/kauppasota-on-porsseissa-ohi-tekoaly-on-jalleen-muodissa
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Here is Henri Huovinen’s good tweet on the development of the Helsinki Stock Exchange’s CAPE over the years.
The highest peaks of CAPE ratios at the turn of the millennium indicated the wild pace of that time. The valuation levels then reflected the exciting growth hype and tech bubble of that era.
In recent years, CAPE seems to have been in a slump, if one can say so.
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What’s in store for next week?
https://x.com/eWhispers/status/1946197577403076773
Is there something happening in Finland next week?
https://www.inderes.fi/markets/calendar
Next week’s macro vibes
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Just a few years ago, FAANG companies were on everyone’s lips, being snapped up by Finnish influencers and beyond. N was, of course, Netflix, the true modern streaming software company, not some upstart hardware manufacturer. That’s just how the world changes before our eyes, and the crown of tech companies constantly changes hands. After all these years, it’s becoming mentally difficult to imagine that the IT sector would ever lose its crown as the stock market’s growth driver and that we would return to the good old days when Exxon, GE, AT&T, P&G, and similar companies dominated the US stock market 
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Vartti is back on screen 
The trade war is not over in real life, but the stock markets have stopped reacting to it. In principle, Trump has already won: the average tariff level has risen sharply without major escalation. Life goes on. On the other hand, I wouldn’t count my chickens before they hatch. Long-term effects and the arbitrary use of tariffs as a political tool could still bring unpleasant surprises.
https://www.inderes.fi/videos/kauppasota-ohi-tekoalybuumi-jatkuu-or-vernerin-vartti
The impact of the trade war on inflation is unclear for now. Some hints of it are visible in the United States. But in large economies, inflation does not seem to be developing steadily in the desired direction (towards the 2% target) anyway. In fact, the slowdown in inflation has turned into an acceleration, for example, in Britain and Japan. I haven’t had much time to talk about inflation this year, but this is worth following.
Plenty more charts included, enjoy!
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Today, grim data emerged regarding Finland’s unemployment, which has risen from last year, but according to MTV, there was also optimism:
“Men’s employment has indeed taken a turn for the better, and this foreshadows a cyclical upturn, meaning growth is happening.”
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Apparently, some kind of deal has been reached with Japan, Trump boasted last night.
“We just completed a massive Deal with Japan, perhaps the largest Deal ever made," Trump wrote in a Truth Social post. The president said the agreement includes a 15% tariff on imported goods from Japan, and the country will invest $550 billion into the US.
Details will likely become clear in the coming hours or days.
I don’t know what that $550 billion investment commitment entails and how it will be implemented in practice.
But that fits into the theory where tariff threats are used, in addition to a higher tariff level, to try to get US allies to invest in the United States. Either in industry, or, for example, to lend to the constantly indebted federal government.
This “investment obligation” is in a way a payment for the US-provided a) security and b) access to the world’s largest consumer market.
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I’ll just selectively bring company-level news to this thread, but they can also provide some insight more broadly into the stock market and the economy.
From the semiconductor sector, Texas Instruments joined the chorus of those issuing warnings. The company cannot say how much it benefited in Q2 from sales brought by the temporary tariff truce and whether future performance will be weaker.
Though the company issued a third-quarter forecast that beat most estimates, the outlook was more guarded than some investors had anticipated. The stock fell further during a conference call, when executives struggled to win over analysts who said the company’s tone had become increasingly negative.
The main concern is whether tariffs and trade disputes will hurt a sales resurgence that’s still in the early stages. While revenue jumped 16% last quarter, executives acknowledged that they didn’t know how much of that came from tariff-related “pull in” — customers making purchases to get out ahead of the levies.
Earlier, for example, ASML warned about the uncertainty brought by the trade war. However, it’s worth remembering in the semiconductor sector that part of the sector is simultaneously in recession due to weak demand in consumer electronics and the automotive industry, while companies more directly exposed to the AI boom are thriving.
https://finance.yahoo.com/news/texas-instruments-plunges-forecast-fuels-223858626.html
Addition. General Motors, in turn, absorbed the tariffs, as the automotive industry in America seems to be doing more broadly out of fear of retaliation. No wonder car prices didn’t rise much in the latest inflation report! 
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I personally find the theory you brought up quite credible. The basis of that theory is the Mar-a-Lago Accord, which can be seen as a plan for Trump’s economic policy, where defense policy is also quite brazenly linked as part of it. The methods you mentioned are also specifically highlighted in Stephen Miran’s report, which is closely connected to that plan.
Link to the report: https://www.hudsonbaycapital.com/documents/FG/hudsonbay/research/638199_A_Users_Guide_to_Restructuring_the_Global_Trading_System.pdf
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