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    Trump Is Immensely Vulnerable

    How can Americans best defend their democracy from their president?In my last column, I recounted three lessons from other countries where popular movements have made headway challenging authoritarian rulers. Critics of President Trump have frankly been fairly ineffective — witness his election and the way his approval ratings have risen in some polls lately — but Trump does give us a great deal to work with. He is immensely vulnerable.Drawing upon these lessons from my last column, here are what I see as the most promising lines of attack for his critics:Trump is deeply corrupt. All presidents are accused of shady practices: Remember that President Barack Obama was said to have diminished the presidency by wearing a tan suit. But Trump is a felon who is using his office to enrich himself as no president has in history.The Times reported that more than $2 billion has flowed to Trump companies in just a month, and some of his ventures look alarmingly like opportunities for influence-peddling. How else do we explain his announcement that the biggest investors in his new cryptocurrency memecoin, $TRUMP, would get dinner with him? Some guests flew in from overseas for the dinner, held Thursday, and acknowledged earlier that they hoped to influence Trump and his administration’s policy on financial regulation.The Trump family started a different cryptocurrency outfit, World Liberty Financial, that received a $2 billion investment from the United Arab Emirates. Don Jr. is also starting a members club in Washington, with a $500,000 charge to join. And Saudi Arabia and Qatar are investing in Trump businesses, putting money in family bank accounts.Meanwhile, Trump is using the government to help his pal Elon Musk (who even knew that the world’s richest man was needy?). The White House South Lawn was turned into a temporary showroom for Tesla vehicles in March, Commerce Secretary Howard Lutnick urged people to “buy Tesla” stock, and American embassies reportedly have pushed impoverished countries to grant regulatory approvals for Musk’s Starlink system.Trump is hurting you in the pocketbook. One reason Trump won the presidency was voter resentment at inflation and economic weakness under Joe Biden. Now it’s Trump who is badly damaging the economy and hitting voters in the wallet.

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    What Has Changed Since Silicon Valley Bank Collapsed? Not Much.

    Two years later, no major legislation or regulation has passed, and the basic problem that caused the crisis persists.Two years ago, the collapse of Silicon Valley Bank sounded an alarm over vulnerabilities in the banking system. And briefly, it looked like a call to action: The Federal Reserve released a 102-page critique of its own failures in oversight; Congress kicked off hearings to examine banking legislation; and columnists (including this one) outlined ideas for preventing the next crisis.Yet all of that talking has led to very little. Regulators tightened up on supervision, at least for a while, but there haven’t been any major new laws or regulations. And the basic problem at the heart of the regional banking crisis remains: The financial system as a whole relies heavily on runnable liabilities — namely, sources of funding, such as uninsured deposits, that can be yanked away abruptly.As long as banks are financially healthy, runnability is not a big problem. Regulators say the current risk is relatively low. Silicon Valley Bank is back in business under new ownership. “Over the past year, vulnerabilities from funding risks have declined to a level in line with historical norms,” the Fed wrote last month in its semiannual Financial Stability Report.But runnability becomes a source of vulnerability when insolvency threatens, as happened to Silicon Valley Bank. And troubles could resurface. For example, President Trump’s tariff war might cause an economic slowdown or recession, which could result in big losses for some banks through their loan portfolios.It doesn’t help that regulators seem to be shifting their focus away from the problems that Silicon Valley Bank brought to the surface. An interagency plan from 2023 to increase bank capital requirements starting this July 1, which bank lobbyists opposed, is being scaled back and postponed. Last month, Treasury Secretary Scott Bessent said he wanted to “help get banks back into the business of lending” by reducing how much they needed to keep in liquid assets such as Treasuries. And this past week, The Financial Times reported that regulators were preparing to announce within months a reduction in the supplementary leverage ratio, a backstop safety measure adopted in 2014.The financial system still relies heavily on runnable liabilitiesA bank run occurs when depositors and other creditors of a bank start to worry that their money is unsafe or might become unsafe, and pull it out while they still can. (See: “It’s a Wonderful Life,” 1946.) Deposit insurance is supposed to relieve that worry, but it doesn’t cover all bank liabilities. At Silicon Valley Bank, to take an extreme case, 94 percent of deposits were uninsured. Some other sources of funding that banks rely on can also be snatched back abruptly, such as short-term borrowings from other banks.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Someone Should Tell Trump He’s About to Make the Trade Deficit Worse

    There are many reasons President Trump should not be pushing Congress to pass huge tax cuts, but here’s one you may not have heard: Budget deficits and trade deficits are twins. When the former go up, so, generally, do the latter. So at the same moment Mr. Trump is upending the global economy in a feckless attempt to eliminate America’s trade deficit, he’s essentially pressuring Congress to increase it.Here’s how it happens. The United States buys a lot of goods from other countries, and we pay for the goods with dollars. But those dollars are no good abroad, so the countries we buy from invest them here. Some of the money goes, directly or indirectly, into businesses that are raising cash to build new data centers or expand natural gas facilities or construct new apartment complexes. Other dollars go into Treasury bonds or bills, which the federal government uses to fund our large budget deficit. (The same thing happens in reverse when other countries buy from the United States — but to a lesser degree, since our imports are larger than our exports.)If the budget deficit rises, American investors could theoretically cover the shortfall, but that would mean putting their money in Treasury securities rather than businesses and their capital needs. The other option is that foreign countries amass more dollars and plow them back into the U.S. economy. How would they get those additional dollars? From all the German cars and Chinese electronics and imported beer that Americans will buy with the money from their tax cuts.More generally, a larger budget deficit will require the government to borrow more money, which drives up interest rates. Higher interest rates mean a stronger dollar, which makes it more expensive for people in other countries to buy our products, cheaper for us to buy theirs, and thus the trade deficit widens.So cutting taxes, as Mr. Trump has told Congress to do, will drive up the budget deficit — and the trade deficit. All of this may seem counterintuitive, but it’s one of the few things that economists agree about.The budget deficit is already worryingly high and the tax cuts Mr. Trump is seeking would make it even larger. Last year the United States ran a $1.8 trillion budget deficit, or 6 percent of the gross domestic product — higher than at any other time except during World War II, the late-2000s financial crisis and the Covid-19 pandemic — despite strong economic growth and no unusual emergencies.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Under Trump, Stocks Have the Worst Start to a Presidential Term Since 1974

    During the first 100 days of the Trump administration, shock waves from the chaotic tariff rollout continue to send tremors through the global financial system.One hundred days of President Trump. Seventy days of whipsaw trading in financial markets. Thirty three days of losses. More than $6.5 trillion wiped from the value of public companies.For financial markets, the 9 percent drop in the S&P 500 is on track for the worst start to a presidential term since Gerald R. Ford took over from Richard M. Nixon in August 1974 after the Watergate scandal. The slump is worse even than when the tech bubble burst at the turn of the century, and George W. Bush inherited a market already in free fall.In contrast, Mr. Trump inherited an economy on solid footing and a stock market rising from one record high to another.That swiftly changed when Mr. Trump unveiled his marquee suite of tariffs on April 2 — not the first new import taxes announced by his administration, but by far the most sweeping. Volatility erupted. Wall Street frantically began to grapple with the economic consequences of the new government’s policies.The S&P 500 tumbled more than 10 percent in two days, a drop comparable to some of the worst days of the pandemic-induced sell-off in March 2020 and, before that, the financial crisis in 2008.Stocks have since stabilized, but the shock waves from the chaotic tariff rollout continue to send tremors through the global financial system.Trump’s Astonishing 100 Days, in 8 ChartsBy many measures, the opening months of President Trump’s second term stand apart from those of essentially any modern president.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Scott Bessent Accuses IMF and World Bank of ‘Mission Creep’

    Treasury Secretary Scott Bessent on Wednesday called for major overhauls to the missions of the International Monetary Fund and the World Bank but said that the United States remained committed to maintaining its leadership role at the global economic institutions.The comments, made at a speech on the sidelines of the spring meetings of the I.M.F. and the World Bank, come at a moment of concern among policymakers that the Trump administration could withdraw the United States entirely from the fund and the bank.The United States has upended the global trading system in recent months, and the views of the Trump administration on climate change, international development and economic equity are often at odds with those of the other nations that are shareholders in the global institutions.The speech came a day after the I.M.F. downgraded its outlook for growth globally and in the United States as a result of President Trump’s punishing tariffs. Trade tension between the United States and China, the world’s largest economies, threaten to weigh on output this year and next.In his remarks, Mr. Bessent defended the Trump administration’s trade actions and called for China to curb economic practices that he said were destabilizing international commerce. He noted that the United States was actively engaged in trade talks with dozens of countries and expressed optimism that these negotiations would help rebalance the world economy and make the global trading system more fair.It remains unclear when, or if, the United States and China will begin to engage in talks. Mr. Trump has said he expects to speak with Xi Jinping, China’s leader, but no formal conversations have been scheduled.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Stocks Edge Higher Amid Trump Tariff Uncertainty

    The Trump administration’s chaotic tariff rollout continues to spur volatility in the markets.Stocks inched higher in early trading on Tuesday, as the Trump administration’s chaotic tariff rollout continues to spur volatility in the markets.The S&P 500 opened up 0.5 percent, and the technology-heavy Nasdaq also gained slightly. President Trump’s whipsawing tariff policies are still driving sentiment on Wall Street, especially in sectors facing the threat of more levies or potential reprieves.Here’s what else to know:Bank stocks rose on Tuesday, as major U.S. lenders reported their latest earnings. Bank of America surpassed Wall Street’s profit and revenue expectations, and its shares rose about 5 percent Tuesday morning. Citigroup’s profits also beat estimates, sending its stock more than 2 percent higher.Tariff threats are taking center stage in the pharmaceutical and technology sectors, after the Trump administration on Monday took steps that appeared likely to result in new tariffs on pharma products and semiconductors. Shares in drugmaker Eli Lilly were up slightly on Tuesday morning, while Novartis stock was trading roughly flat. Shares in chip giant Nvidia were nearly 2 percent higher, after the company on Monday said it would invest in artificial intelligence infrastructure in the United States.Shares in Boeing, the aviation giant, fell about 1.5 percent on Tuesday following a report from Bloomberg News that China had instructed its airlines to halt deliveries of Boeing planes after the Trump administration imposed steep tariffs on Chinese goods.In the auto industry, shares in General Motors, Ford Motor and Stellantis — which jumped on Monday after Mr. Trump signaled that he might offer car companies some relief from tariffs — were mixed on Tuesday morning. Shares in General Motors and Ford both fell more than 1 percent, while Stellantis rose about a half percent. The sector, which is grappling with a 25 percent tariff on imported vehicles, is bracing for new levies on imported car parts.The U.S. dollar, long a haven in global financial markets, has been falling against other major currencies. But an index that tracks the currency against a basket of major trading partners stabilized early Tuesday, ending a five-day slide. More

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    JPMorgan Chase CEO Jamie Dimon Warns of Economic Pain From Trump’s Tariffs

    President Trump’s wave of tariffs threatens to bring both short-term economic pain, including lower growth, and long-term damage to America’s standing and trade relationships around the world, the chief executive of Wall Street’s biggest bank warned on Monday.“The recent tariffs will likely increase inflation and are causing many to consider a greater probability of a recession,” Jamie Dimon, JPMorgan Chase’s chief executive, wrote in his annual letter to shareholders.The warning by Mr. Dimon, one of Wall Street’s most influential leaders, echoes the growing anxiety among corporate chiefs about how the tariffs will play out. Even those who had initially professed support for Mr. Trump’s trade plans are becoming increasingly worried about the consequences.Even before Mr. Trump’s tariff announcement last week, the U.S. economy had been showing signs of strain after years of healthy performance, Mr. Dimon wrote. Inflation was already a worry, Mr. Dimon said, pointing to a yawning fiscal deficit and the need for more infrastructure spending. And stock valuations remain well above historical averages, — even after the recent market sell-off.The potential consequences of the trade fight could make things worse, the letter said. Those include other countries’ efforts to fight back — as China has done by imposing 34 percent counter-levies — and a possible erosion of confidence among consumers and investors. Mr. Dimon also warned about the weakening of the American dollar’s role as the global reserve currency.“If America, for whatever reason, becomes a less-attractive investment destination, the U.S. dollar and the economy could suffer if foreigners sold their U.S. assets,” he wrote.JPMorgan’s own economists have increasingly been saying that a recession is more likely this year, though Mr. Dimon did not personally take a position on those odds in his shareholder letter.While Mr. Dimon asserted that JPMorgan itself was strong enough to withstand the shocks that the levies posed — its traders have profited from previous whipsaws in the markets — the global economy may not be so fortunate. “It is not particularly good for the capital markets,” Mr. Dimon wrote of the tariff-linked volatility.For now, Mr. Dimon wrote that he was hoping for a speedy resolution to the trade battles. “The quicker this issue is resolved, the better because some of the negative effects increase cumulatively over time and would be hard to reverse,” he wrote.The longer-term worry, Mr. Dimon said, is that Mr. Trump’s fight could shred decades-old alliances that cemented the United States’ primacy in the global order. The JPMorgan chief wrote that he was worried that America’s trading partners might seek out deals with the likes of China, Iran or Russia in response to the tariffs.“America First is fine,” Mr. Dimon wrote, referring to Mr. Trump’s description of his policies — “as long as it doesn’t end up being America alone.” More

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    Consumer Bureau Seeks to Undo Settlement and Repay Mortgage Lender

    The Consumer Financial Protection Bureau wants to return a $105,000 penalty it collected last fall when it resolved a discrimination lawsuit.Under President Trump, the Consumer Financial Protection Bureau has dropped nearly a dozen enforcement cases brought during the Biden administration, ending lawsuits against banks and lenders for a variety of financial practices that the watchdog agency no longer considers illegal.But on Wednesday, the bureau went a step further: It is seeking to give back $105,000 that a mortgage lender paid to settle racial discrimination claims last fall.In an especially strange twist, the case — against Townstone Financial, a small Chicago-based lender — was brought during Mr. Trump’s first term by Kathleen Kraninger, the director he appointed to run the consumer bureau.Russell Vought, who became the agency’s acting director last month, said it had “used radical ‘equity’ arguments to tag Townstone as racist with zero evidence, and spent years persecuting and extorting them.”In its filing asking the U.S. District Court for the Northern District of Illinois to set aside the settlement it approved in November, the bureau said it had found “significant undisclosed problems” in its handling of the lawsuit, which the new leadership called an “unmerited” complaint that violated the defendants’ First Amendment free-speech rights.The case began in 2020 when the consumer bureau accused Townstone of redlining and breaking fair-lending laws by discouraging residents living in majority-Black neighborhoods from applying for its housing loans. It homed in on comments made during the company’s radio show and podcast, “The Townstone Financial Show,” saying they were intended to rebuff Black borrowers or those seeking to buy homes in certain neighborhoods.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More