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Good morning and welcome to White House Watch! Today is Donald Trump’s 100th day in office, so let’s jump into:
The bonfire of political capital
Reshoring the iPhone
Upheaval in Washington
Trump’s honeymoon period with the American public has been particularly brief.
He appears to be less popular at the 100-day mark than any other president since the inception of approval polling, according to figures from FiveThirtyEight and the New York Times.
Trump’s net approval, which turned negative in March, has been dented by mounting scepticism over his aggressive trade policies and gutting of the federal government. Voters are particularly critical of his handling of the economy, an issue where he had the upper hand during last year’s presidential campaign.
“People still go to the grocery store and they get angry, and so, you know, that’s having an effect,” said Doug Heye, a Republican strategist. “He wasn’t elected to do all of those things that he seems to really be spending most of the time talking about.”
Polls show voters increasingly see Trump as neglecting cost-of-living issues and spending too much time trying to overhaul the global trade agenda.
Wall Street’s early love of Trump has also fizzled, in part due to the president’s erratic trade policies, which rocked investors’ faith in US growth prospects. The benchmark S&P 500 stock index has fallen about 8 per cent since Trump’s inauguration in January, the worst start for any new administration since Gerald Ford.
“My model for where we are is Wile E Coyote with his legs spinning in the air trying to figure out how big of a cliff we’ve just jumped off,” said George Pearkes, a macro strategist at Bespoke Investment Group.
From issuing executive orders at an unprecedented rate to implementing the highest effective tariff rate since the second world war, the immense scale of Trump’s actions — and their fallout — is clearly visible in the data. [Free to read].
The latest headlines
Trump will struggle to build iPhones in the US. The world’s most popular smartphone is a jigsaw of thousands of pieces sourced from 187 suppliers in 28 countries.
US ports and air freight managers are feeling the trade war blues as they grapple with sharp declines in goods transported from China.
British universities are in vogue as the Trump administration’s assault on Ivy League institutions pushes US students to look across the Atlantic.
The US president stepped up his criticism of Vladimir Putin over Russia’s continued attacks on Ukraine, but also insisted that a deal to end the war remained within reach.
Republican lawmakers proposed shutting down the US audit regulator, which was created two decades ago to prevent another Enron-like scandal.
“Will we ever reach some sort of steady state of tariffs?” Our experts answered readers’ questions about Trump’s first 100 days in office.
What we’re hearing
Washington’s economy has been sheltered during previous downturns thanks to the district’s interconnectedness with the federal government. That unique economic identity is changing as government lay-offs led by Elon Musk’s so-called Department of Government Efficiency pummel the local labour market.
“We see the changes in the federal landscape as really existential to our region,” said Julie Coons, chief executive of the Northern Virginia Chamber of Commerce.
Locals are already pulling back on spending amid mounting unemployment fears. Mike Macklin, president of kitchen remodelling company Cameo Kitchens in northern Virginia, said he had laid off staff this year and “anticipates doom and gloom for the next couple of months”.
The city’s cultural scene is changing too. Trump has overhauled the board of the John F Kennedy Center for the Performing Arts, and amid the president’s crusade against diversity, equity and inclusion, the yellow letters spelling out “Black Lives Matter” on the street outside the White House were removed. Washington’s Democratic mayor acknowledged that the move came after conversations with the White House.
Meanwhile, Butterworth’s, a restaurant in Capitol Hill, has become a central spot for the Maga faithful. Diners have included Treasury secretary Scott Bessent, FBI director Kash Patel, and Elon Musk’s former partner Grimes.
The menu includes duck, rabbit and venison. “The Maga crowd is a lot more diverse than the media make them out to be,” said Alex Butterworth, an Australian lawyer for Uber and the primary investor in Butterworth’s. “You have people who like foie gras martinis and bone marrow.”
But the restaurant scene at large is struggling. About 44 per cent of Washington’s full-service casual dining spots say they are likely to close this year, partly because of the economic effects of federal lay-offs, according to the Restaurant Association of Metropolitan Washington.
Viewpoints
Panic has become a guiding and “self-stabilising” force for the world economy, argues Andy Haldane, former chief economist at the Bank of England.
Investors need to prepare for a new market paradigm where the dollar is no longer the only game in town, writes Rana Foroohar.
Hank Paulson, a former secretary of the Treasury, says the US should invest in clean energy to win the artificial intelligence race with China.
Wall Street stocks still have much further to fall, according to Tej Parikh. [Available for Premium subscribers]
