Here we go again? Maybe.
In my newsletter column this week, I tried to address the Trump tariffs and how startup CEOs should think about it.
As of writing, the US stock markets are down about 15% since Trump announced his attack on the global economy. That’s enough evidence of two things: (1) most market participants were not expecting Trump to do anything this extreme, and (2) most market participants think his tariff policies are foolish and destructive. Following the election in 2024, I decided to withhold judgment and hope for the best. At this point, I am ready to judge. Trump is a menace to the American republic and a threat to global prosperity and stability. But that is politics - and this is not a political newsletter.
For founders running startups - the order of the day is to secure the rigging and make ready for heavy weather. As Ed Sim of Boldstart wrote in his outstanding newsletter, it’s “time to dust off that old post-ZIRP recession playbook.” Ed is absolutely right. We don’t know what is coming, but the wind has picked up and the horizon has darkened, suddenly and unexpectedly. As we all head off to prepare for the worst, I want to leave you with two optimistic thoughts:
The first piece of optimism is that we have all been here before. COVID ripped through the world, and we prepared for the worst. The ZIRP era imploded, and we again prepared for the worst. Now a global recession threatens, and we must yet again prepare for the worst. But if you are running a startup today and still operating, chances are you have already weathered at least one similar storm. You know the drill.
The second piece of optimism is that this situation is unlikely to persist. I find it hard to believe that, twelve months from now, the global economic outlook will be as bleak as it appears to be in this moment. Trump’s trade policy is an unforced error and a self-inflicted wound of the highest order. My disdain for him is matched by my faith in the ultimate wisdom of the American people to force their government to make better choices eventually. While there are plenty of reasons for fear and concern, there are also plenty of reasons for optimism that good people on both sides of the Atlantic will find a better way forward. I do not believe we need to prepare ourselves for an age of permanent darkness. The economic and political sun will shine again. Our role as politically engaged patriots is to work for better leadership wherever we are. Our role as business leaders, however, is to ensure that our organizations survive the coming period as best we can without compromising our values and our ethics.
We’ve got this.
