Hamza Adam 
CNN’s Pamela Brown was unnerved by an analysis by Financial Times editor Ed Luce, who said the economy could take years to stabilize following president Donald Trump’s tariffs.
Luce, the publication’s U.S. national editor and columnist, said the double-digit tariffs on imports from dozens of trading partners would send prices soaring and shake the stock market, which would hit Americans who are planning to retire soon especially hard.
“If you’re retiring in the next year or two, this is extremely bad news,” Luce said. “If you’re, you know, 45 [years old], then of course you can afford to wait, but a lot of it depends on is this a permanent shift to de-globalization, because if you’re going to de-globalize, then everything becomes less efficient and prices just go up structurally, and that means that the returns on equities, the stock market growth is reduced. So a lot depends on on just how sustained this war of Trump against the whole world happens.”
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“Normally, when you go to war, any kind of war, including economic war, you go to war with allies,” Luce added. “In this case, the allies and America’s adversaries, say the Europeans, Canadians and the Chinese, are all together against America. It’s not a bet that I would think has a very high chance of paying off.”
The situation is confusing for investors, Luce said, and he’s not sure where Americans should park their money as the trade war plays out.
“There is a dash for cash going on right now,” Luce said, “and that is part of why hedge funds are unwinding their [treasury bonds], because their clients are making calls on them. So they’re selling their treasuries to pay their clients because their clients are so nervous. So there is a dash for liquidity for cash going on. There’s not really any other asset that’s considered safe. I mean, German bonds to some degree, certainly not Chinese. Everybody’s seeing their bond yields rise, their interest rates rise, so cash is going to be king whilst everybody’s deeply uncertain and nervous about where things are going.”
Brown seemed spooked by his analysis.
“Very concerning what you just laid out there,” she said. “Thank you very much for coming on to give your analysis.”
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