Trump's Actions Erode Trust in US, Allies Move Gold Reserves Overseas
Nobel economist Paul Krugman believes that US President Donald Trump's actions have caused its allies to lose trust in the country. Since Trump returned to the White House roughly 19 and a half months ago, he has taken several steps that have alienated the United States' closest allies.
Krugman warns that fears of Trump and his allies seizing gold are no longer far-fetched. He notes that 'rule of law' is not a phrase often applied to the Trump administration, and they have special contempt for international law. Many of Trump's tariffs have been ruled illegal under US law but were in clear violation of past agreements.
The Dutch Central Bank recently announced that it was shifting about $12 billion in gold from the vault in New York to the Bank of England's vault in London, following a similar move by the French Central Bank. Other countries are considering similar moves.
Krugman notes that although the direct economic or financial impact of these actions will be minimal, the symbolism is chilling. America is no longer trusted, he warns, and it will take many years of honest and responsible US government to restore that lost trust.