Davos elite nods as Trump issues ultimatum

World leaders, CEOs of the world’s largest companies and a host of celebrities gathered in the small Swiss mountain town of Davos for the annual World Economic Forum this week.

On the other side of the Atlantic, President Donald Trump began his political comeback as the new President of the United States.

“Nothing will stop us,” he declared, vowing to end America’s “decline.”

Near the end of the meeting, President Trump was beamed from the White House webcam to deliver his message of world domination directly to the world’s elite.

While he charmed, almost seduced, audiences with a believable picture of a booming American economy about to reach new technological heights, he simultaneously threatened tariffs on those who did not choose to move their factories to the US.

Trillions of dollars in tariffs for the US Treasury on those businesses that export to the US market from foreign factories.

“Your prerogative,” he said with a smile that wouldn’t be out of place in The Godfather. And then for one of his own, the head of Bank of America Brian Moynihan, a great public rant, accusing the credit giant of “debanking” many of his conservative supporters.

He mumbled awkwardly about sponsoring the World Cup.

In this first week of his second term, most people in Davos were shaking their heads because they still couldn’t figure out what else to do.

Two worlds collided as the “America First” president was beamed like a 30-foot interplanetary emperor into the heart of a rules-based international economic order.

It’s one thing to assume that the trade deficit is a problem for your domestic electorate. iIt is quite another thing to propose in an international forum to a G7 ally, Canadabecome the state of your nation, drawing sighs from the audience, and not just Canadians.

The appeal was, by design, charming and insulting. He was a scourge and gingerbread for the rest of the world.

As delegates considered a mix of threats, invitations and occasional praise, many appeared to be trying to decide how much damage Trump could do to the global trading system while assessing how far ahead of him America is in this artificial intelligence technology boom.

This first week of Davos was the alternative pole of Trump’s second term.

His agenda had consistency to use all means reduce energy prices, including by putting pressure on Saudi oil.

This, according to him, will not only help reduce inflation, but also drain the Russian military coffers of petrodollars to help stop the war in Ukraine by economic means. The ceasefire in the Middle East has already given Trump some geopolitical credibility in these circles.

Christine Lagarde, David Miliband and John Kerry bustled into the room. Heads of various banks gathered on stage to praise and then easily question the president.

The bottom line was this: Is President Trump serious about what has sounded like a threat to the global economic system since the election campaign? The answer will be heard for the next four years and beyond.

The answer sounded like a very definite yes. However, that doesn’t mean it will work.

Some top US CEOs have told me they are bracing for reciprocal retaliatory tariffs on their exports. Their assumption was that the president’s love of a rising stock market would limit his imposition of tariffs.

But nobody really knows. In any case, there is a lot to capture. He has already left the World Health Organization.

On the quays, it was said that his allies in the 2025 project are proposing the withdrawal of the USA from the IMF and the World Bank.

The rest of the world has some leverage once it decides to rise from the Trump whirlwind.

Canadians are now announcing their tariffs in response. In talks with UK Business Secretary and EU Trade Minister Jonathan Reynolds and Marash Shefcavich, Head of the European Union on TradeI discovered a desire for calm dialogue.

Both are making the same arguments to try to dissuade Trump from raising tariffs.

Mr. Reynolds told me that since the US has no deficit in goods trade with Great Britain, there is no need to impose tariffs.

Mr. Šefčovič said the U.S. should also consider surplus services.

But don’t they consider threats to G7 and NATO allies Canada and Denmark (for Greenland) to be just as unacceptable and as absurd as France’s demand for Louisiana? Shefcovich did not want to beat anything.

Diplomats are drawing up lists of US goods that Europe can now buy to show off President Trump’s “wins”, from weapons to gas to magnets in wind turbines.

It might make some sense for the rest of the G7 to work in unison to retaliate against the tariffs to focus the minds of Congress and rival factions in Trump’s court.

There is no indication of this.

The history of US technical superiority, epitomized by the braliarchy – ieincluding Amazon founder Jeff Bezos, Meta boss Mark Zuckerberg, Apple leader Tim Cook and Google chief Sundar Pichar – took first place at this week’s inauguration.

While the US is ahead of Europe, its position against China is more uncertain.

One of the talking points at Davos was DeepSeek’s high-performance, much cheaper artificial intelligence model made in China. Predictions that the tech brothers would tear each other’s stripes in Trump’s court began to come true within hours, not months.

Meanwhile, while most, if not all, here in Davos seemed quite seduced by Trump’s technological optimism, some in Europe also see a once-in-a-lifetime opportunity to bring in leading researchers who may not be too enamored with the direction of US policy. . The head of the European Central Bank, Christine Lagarde, openly spoke about it.

Others sought solace in the fact that Europe would no longer have to deal with Biden’s massive green subsidies, once again creating a more level playing field for Europe.

President Trump is changing the terms of world trade. The reaction of the rest of the world to this is as important as the decision of the Trump administration itself.

January 24: The headline of this story was updated to better reflect its content.