What’s changing in the US economy?

The U.S. government is changing how it handles trade and industry. Instead of focusing on free trade and cheap imports, it’s now using tariffs (extra taxes on goods from other countries) to protect American businesses. This approach is called mercantilism, and it’s similar to what China has been doing for years.

The goal? Bring back manufacturing jobs, make the US economy more advanced, and rely less on other countries.

Why tariffs are controversial

Many experts say tariffs make things more expensive for everyday people and businesses. They argue that this can lead to higher prices, job losses, and weaker industries in the long run.

But the Trump administration believes that focusing too much on cheap goods hurts the country. They say it’s more important to build strong industries at home — even if it costs more in the short term.

Why economic complexity matters

The government also wants the US to produce more advanced goods. They point to countries like Australia, which mostly exports simple products like minerals, and say that’s not enough to stay competitive. A more “complex” economy — one that makes high-tech and diverse products — is seen as stronger and more innovative.

Concerns about government overreach

Some recent decisions by the US government have raised eyebrows. For example:

• Big tech companies like NVIDIA and Intel are being asked to give part of their profits or ownership to the government.

• Tariffs have been used not just for economic reasons, but also to punish countries like Brazil and India for political issues.
  

These moves make some people worry that the government is getting too involved in business decisions.

The US versus China: Who has the upper hand

The US says it has the advantage in trade disputes with China because it buys more from China than it sells to them. But this might not be true. China makes many things the US needs, and it can handle losing some sales better than the US can handle losing access to those goods.

What this means for investors

Because of these changes:

• Investors may prefer companies that do most of their business in their own country.

• Businesses that rely on global trade could face more risks.

• Regional trade partnerships (like between the US, Mexico, and Canada, and the European Union) may become even more important.
  

Our investment approach

We’re currently investing less in US shares, especially in tech companies that seem overpriced. Instead, we’re focusing more on:

• Emerging markets and other global regions

• Infrastructure and clean energy

• Industrial real estate tied to digital and logistics growth
  

We actively manage our portfolios, looking at both long-term trends and short-term risks. This helps us prepare for different possible futures and avoid surprises.