That’s the title of my presentation at the 2025 Minnesota Economic Association annual meeting, where I had the honor of speaking at the Leonid Hurwicz Lecture. It was a fantastic opportunity to share my thoughts and in responding to thoughtful questions, expand my views. The event took place at St. Catherine University yesterday.
Here’s one picture:
Figure 1: Inbound FDI, mn Ch.2017$ (blue, left scale), Trade Policy Uncertainty (teal, right scale). Trump administration periods shaded light orange. NBER defined peak-to-trough recession dates shaded gray. Source: OECD, BEA, matteoiacoviello.com, NBER, and author’s calculations.
I discussed trade protectionism, policy uncertainty, restrictions on immigration, reduced foreign direct investment, and the threat to dollar dominance (slides here).
During the Economic Data Roundtable, Dr. Abigail Wozniak (Minneapolis Fed), Angelina Trâm Nguyễn (Minnesota DEED), and Dr. Aaron Sojourner (Upjohn Institute) spoke on issues relating to how the collection and development of labor market data critically supports policymaking, with emphasis on the indispensable nature of government data compilation.
Many thanks to Kristine West and Louis Johnston and the other officers of the MEA for the opportunity!
Direct foreign investment plunged in 2014 after the BRIC bubble fully popped as seen in commodities. There is little meat on those bones. Nor is immigration being “restricted”. Indeed, illegal immigration has risen in 2025 despite actual inflows being down and reduction in demand. What that means, actual immigration enforcement is reduced. Deportations down. Stop falling for ” theater “. Nor is there much protectionism. Another outdated term. Actual capital markets have been deregulated, which mean easier for foreign capital flows to enter the us.
Stop talking the book and understand the grift. Debt markets are collapsing, much like in 2007, this time to corporate debt markets. Wait until 2026 when it spreads upstream like 2008.
Calling a 9% tariff high is embarrassing. Its a useless small consumption tax.