Citadel founder Ken Griffin warned on April 23 at the Semafor World Economy Summit in Washington that President Trump’s escalating trade war is undermining the United States’ global brand and putting its once-unquestioned safe-haven status at risk. He told attendees that erratic tariff policies have shaken investor confidence in US Treasury securities—long regarded as the world’s premier store of value—and warned that repairing the damage could take years.
President Trump announced sweeping tariff hikes on April 2, imposing a 10% levy on virtually all imports and even higher rates on China, Canada, and the European Union, triggering a sharp market sell-off in early April. Within days, the S&P 500 plummeted by more than 10%, erasing trillions in equity value, while Treasury yields experienced their most considerable weekly rise since 2001 amid dislocations in the bond market.
Ken Griffin’s Warning
“America rose beyond just being a country. It was like an aspiration for most of the world,” Ken Griffin said. “And we’re eroding that brand right now”. He argued that, just as consumers pay a premium for trusted brands, global investors have historically flocked to US Treasuries due to their creditworthiness a reputation now jeopardized by policy volatility.
Ken Griffin, a prominent Trump supporter and megadonor, clarified that he does not oppose tariffs per se but criticised the unpredictable nature of the trade war. “People are not going to build manufacturing in America, because with the policy volatility, you actually undermine the very goal you’re trying to achieve,” he added.
Market Reaction
Investors have responded by fleeing US assets; the ICE U.S. Dollar Index slid to its lowest level in three years, dipping below 97.92 on April 21. Stocks remain under pressure despite a brief two-day rally. US equities have erased nearly $7 trillion of market value since mid-February, with the S&P 500 trading about 16% below its February peak. Bond yields, which move inversely to prices, have surged, reflecting a reduction in demand for Treasury debt.
JPMorgan CEO Jamie Dimon issued a similar caution earlier in April, warning that an “America First” stance could fracture alliances and weaken the country’s exceptional global standing.
What’s Next
- Policy outlook: Market participants will closely monitor any tariff adjustments or pauses as the Trump administration balances political objectives with financial stability.
- Treasury demand: Analysts will monitor bid-to-cover ratios in upcoming Treasury auctions as a gauge of foreign and domestic confidence.
- Brand repair: Ken Griffin urged the president, Treasury Secretary, and Commerce Secretary to “behave in a way that respects that brand,” noting that reputational harm can take a lifetime to mend.
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