Raphael Gallardo, chief economist at French asset manager Carmignac, has declared that the United States is no longer a safe haven for foreign investors. Gallardo cited growing risks tied to President Donald Trump\u2019s recently enacted tax and spending bill, specifically Section 899, which threatens to disrupt international investment confidence due to its punitive tax measures targeting countries with tax policies the US deems \u201cdiscriminatory.\u201d This provision has been labeled the \u201crevenge tax\u201d by market observers, deepening concerns about the stability of US markets.<\/p>\n
The warning echoes wider Wall Street apprehensions that the tax law, combined with Trump\u2019s aggressive trade stance and worsening fiscal health of the US government, could accelerate a decline in investor confidence. Ludovic Subran, Allianz SE\u2019s chief investment officer, suggested the measure might trigger a 5% plunge in the US dollar and a sharp 10% drop in equities.<\/p>\n
Highlights:<\/p>\n
US loses status as secure investment destination due to tax and spending bill risks<\/p>\n<\/li>\n
Section 899 of the bill threatens increased taxes on foreign entities, dubbed \u201crevenge tax\u201d<\/p>\n<\/li>\n
Potential 5% dollar slump and 10% equity selloff predicted by market experts<\/p>\n<\/li>\n<\/ul>\n
Gallardo highlighted that unpredictable US trade policies, doubts over the reliability of America\u2019s foreign policy, and concerns about the rule of law have led traditional US allies to lessen economic dependence on the country. This shifting sentiment is driving a strategic diversification away from US assets toward more stable markets.<\/p>\n
\u201cWhy de-risk? Because the United States have become a totally unreliable military ally and so, one has to secure supply chains, find new markets,\u201d Gallardo explained during Carmignac\u2019s outlook briefing for the second half of 2025.<\/p>\n
Highlights:<\/p>\n