Globalist: if America goes to recession it will be a problem for everyone

This entry is posted on number 18 of Vanity Fair on newsstands until April 29, 2025

Immediately before Easter, China has stopped buying liquefied natural gas – What is transported by ship – from the United States: an inevitable and rational choice, with 49 percent duties on American imports was no longer convenient.
The commercial wars are made like this: the various parts put duties and counterdas as if the commercial flows were immutable, but since the duties are taxes that make the final price of the affected goods rise, as soon as the economy reacts, adapts.

If the Chinese no longer buy American gas, Europeans will be able to buy it at lower pricesbecause the question has not changed but the offer yes, the gas ships that previously went to China must now find other outlets.
If we look at the price of the gas on the European market in Amsterdam, where contracts on future gas purchases (future), you can see that The price is collapsing: from 58 euros for megawatt/hour of February to 35 today. And this is good news for the European industry.

Oil is also falling, In January it was above 80 dollars, now oscillates below 70. If it still goes down, the investments desired by Donald Trump to drill everywhere in the United States will not be there, because they will not be convenient.

The return of protectionism, with the duties of Trump and the counter-adazs of the affected countries, already has a heavy impact on globalization, The drop in energy prices is the signal that things are serious and that growth is slowing down. According to the latest estimates of the World Commerce Organization (WTO), now little more than a study center since its rules are always violated, due to commercial wars, the exchange of goods worldwide could be reduced by 1.5 percent in 2025. It is a heavy contraction, which will mainly affect the economies that entrust their growth to exports.

The most surprising data is the effect of the commercial war in North America, therefore the United States and Canada: This year the exports will fall by 9.6 percent, and this was predictable because the duties serve to reduce dependence on abroad and stimulate domestic production. But exports will decrease even more – 12.6 percent -, confirming that protectionism does only damage: since the duties compromise relationships with commercial partners, those who enter a commercial war suffocated their economy instead of protecting it from external competition to make it more competitive. Obviously all these numbers can change, given that Trump makes sudden decisions that alter the context in a sharp way.

What will certainly not change is the uncertainty that investors and companies have now accepted as a feature of this phase: If the future is unpredictable because hostage of the moods of the American president, investments are paralyzed and the risk increases, therefore the cost of the US debt and funding to businesses and families rises.
Therefore, a recession of the American economy becomes almost inevitable. And if the first economy of the world stops, it is a problem for everyone.

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