The First 100 Days of Donald Trump’s Government
30 APR, 2025
Mario Aguilar, Senior Portfolio Strategist at Janus Henderson
The first 100 days of Donald Trump’s administration have been marked by increased volatility across all markets, alongside growing investor uncertainty regarding the status of the United States and the dollar within the global economic system. This volatility has undoubtedly been fuelled by the large number of executive orders issued by Trump—130 so far this year. In comparison, in his first year as President, Joe Biden issued 77 executive orders, while Trump issued 55 in his first term. In addition to executive orders, we must also take into account the impact of Trump’s statements and opinions shared via the X platform (formerly Twitter), on a wide range of social and economic issues.
Focusing on the economic and financial impacts of Trump’s executive orders and comments, the most relevant relate to:
- Tariffs
- The Federal Reserve and its Chair, Jerome Powell
- Immigration
- Attacks on Universities
As investors facing a scenario of high volatility and uncertainty, I believe we must evaluate both the short- and long-term effects of these potential policies.
The imposition of tariffs, and the threats of increasing them, appear to be a negotiating tactic that, according to Trump, would ultimately benefit the United States in the long run—regardless of the negative short-term impact on inflation, GDP growth, and even unemployment. In the short term, we’ve seen that these policies have led to significant declines in equity markets and a rise in 10-year Treasury yields. It seems that this increase in yields was what led Trump to delay the implementation of some tariffs by 90 days.
Short-term volatility is likely to persist, but the long-term implications are even more concerning. Imposing high tariffs on supposed allies could prompt the creation of new supply chains, new trade alliances, and the emergence of a new dominant international currency to replace the dollar. The privilege of being the primary destination for global savings and the issuer of the world’s reserve currency could shift to another country or region—leading to stronger economic growth elsewhere, while the U.S. becomes increasingly isolated, with a relatively weaker economy and a likely rise in unemployment and long-term inflation.
In such a scenario, it is of course impossible to predict which currency might emerge as dominant. However, given the possibility that the dollar could lose its global status, investors should diversify their portfolios, seeking exposure to other countries, regions, and currencies—as well as to commodities, especially precious metals.
Trump’s attacks on the Federal Reserve and Jerome Powell are also dangerous. A currency’s strength is partly based on the independence and credibility of its central bank and monetary policy. Should markets believe that monetary decisions are being dictated by political motives rather than macroeconomic data, we would likely see a de-anchoring of inflation expectations. This could lead to sharp declines in equity markets and sudden spikes in Treasury yields. It would also bring the dollar’s status as the world’s reserve currency into question—potentially leading to a complete dismantling of the post-Bretton Woods monetary order, with negative global consequences, particularly for the U.S. economy if international investors begin to offload U.S. Treasuries.
Trump’s anti-immigration stance could also affect the economy by pushing up food prices. Many immigrants work in agriculture, and without labour to harvest crops, shortages would drive prices higher. Additionally, the mere fear of deportation could deter illegal immigration, negatively impacting U.S. demographics. While the country still has a relatively young population—especially compared to Europe, China, and Japan—a drop in immigration would undermine long-term economic growth potential, potentially increasing both public debt and the fiscal deficit.
The attacks on universities and the apparently arbitrary suspension of student visas make studying in the U.S. less attractive. This appeal would diminish even further if legal immigration pathways are restricted, making an American education disproportionately expensive given the reduced likelihood of obtaining work permits afterwards. It’s undeniable that a significant portion of U.S. economic success, particularly over the last century, is attributable to immigration. One need only look at the number of patents granted to immigrants, the immigrant executives at top U.S. companies, and the scientists who helped the U.S. prevail in WWII and win the space race.
Undermining universities would reduce their appeal to international students seeking to develop skills and settle in the U.S. long-term, limiting the country’s economic potential. In the short term, the local economies of college towns would also suffer—due to reduced demand for housing, food, student health insurance, and other services.
While there are many other Trump administration policies and proposals that could negatively impact markets, the on-again, off-again nature of this political game gradually erodes U.S. credibility as a dominant economic force and as issuer of the world’s reserve currency.
This analysis focuses on the policies I consider most worrying in both the short and long term. In the near term, these risks suggest that we should diversify our portfolios towards global assets, and reduce exposure to U.S. markets and the dollar. In the long term, the risks suggest we should consider investing in other currencies and increasing exposure to markets that could benefit from a multipolar economic landscape, potentially with a tilt towards domestic markets to foster local economic development.
While this is not a strategy that will entirely shield portfolios from volatility or losses, diversification may be key to strengthening portfolios with a long-term perspective.
