Blain’s Morning Porridge Sept 10th 2025 – Judder Moments in Qatar and Trump’s demands.
“Let them hate us so long as they fear us.”
Yesterday tremblors rocked global markets again after Israel bombed Qatar and Trump demanded Europe enact 100% tariffs on China and India. As America lashes out, It feels the world is tumbling towards chronic trade conflict and disruption – yet, yesterday the US stock market made yet another record high.
Because of the London Tube Strike, I spent yesterday cycling round London on my Brompton Bike. Whoever thinks the fold-up bike is a marvel of British Engineering Brilliance, hasn’t had to lug one upstairs or through a railway turnstile.
The highlight of my day was dinner with my daughter, the last time we will do this together in London. She has resigned from her job in a TV production company. Social media, largely American owned firms, have now captured over 80% of TV advertising. As a result her salary has flatlined for years – despite her company making superb programming. Meanwhile, her rent in London has doubled in the last three years.
After her landlord told her he was selling up, she’s been unable to find anywhere to live at a budget she can afford. She loved her career, but she’s had enough and is leaving – flying to Spain to start a new life. She has the advantage of an Irish Passport – enabling her to escape from the rental trap London has become.
London housing is the flashing red light warning of crisis for the UK economy. Later this month, I will be speaking at a conference about the state of the UK Housing market. I will be joining over 500+ industry professionals, and over 200+ mortgage originators at the at the UK Mortgage Finance Conference on 29 September at The Landmark London — tackling housing affordability and innovative funding solutions. I’m delighted to offer Morning Porridge readers a saving: Use discount code BLAIN10 for 10% off registration.
Back in the markets… we experienced a series of judder moments yesterday.
Yesterday the US stock market hit a new record high – fuelled by expectations of an imminent rate ease. Apple announced its’ new slimline iPhone 17 – which will cost £2000 here in Blighty. I wonder where they will be made? Not in India or China…. Production is going to be a problem for the world’s most successful mobile phone firm if tariffs make them unaffordable for cash strapped consumers, unless of course Cook has done another fawning deal of sycophancy squared with Trump.
The issue of Apple’s production and tariffs puts the issue of the disruption being done to supply and distribution chains around the globe into sharp contrast. There is a growing danger they flare up. Alongside the hype that’s been driving AI investment, a crash in Tech on the back of trade could quickly dampen the market’s current bizarrely blithe outlook. Expect the instability and uncertainty theme to become re-established in coming days.
All this comes at a time when it feels like the US is moving even further away from its current alliances – or unnecessary entanglements as the American right now regards Europe. In the next few days, I am told (by those who know) to expect a new round of major geopolitical shifts as Trump abandons his efforts to become perceived as a global peacemaker. That is likely to have significant consequences on long-term market mood and direction – and further widen the Transatlantic rift.
The first signal of renewed stress was Israel bombing Qatar yesterday. Trump says he knew nothing, but it’s inconceivable the Israeli strike package was able to bomb a target so close to the largest US regional air base. (If that is not the case, then there are serious questions to be asked about the preparedness of US forces under the direction of War Secretary Paul Hegseth.)
More to the point, where does it leave Trump’s campaign for a Nobel Peace prize? Any peace deal in the Middle East is now in tatters – an attack on one Gulf State is likely to have shocked them all.
If one were a conspiracy theorist, one might reckon Trump is looking for a convenient exit. He has discovered Peace in the Middle East and Ukraine is not a 30-minute conversation to be solved through the Art of the Deal. To exit cleanly, he needs to ensure there is blame-game shifting – it can’t ever be his fault negotiations have failed. He’s said he’s angry at Isreal – and I expect will now blame them for the complete breakdown of the bigly wonderful peace agreement he’d negotiated.
The Qataris must be livid. Having gifted Trump a garishly gilded replacement for Air Force 1 they will now be trying to figure out the reliability of their chosen US partner. Actually, the plane was mega-expensive desert hanger-queen the Emir could no longer justify using or maintaining. They’d been looking for a buyer – an insanely rich tasteless oligarch or tech-lord that had their sense of style surgically removed – for ages. No one was interested. And then Trump took a look and said he liked it. Problem solved.
Also yesterday, Trump laid the groundwork for the end of his efforts to solve the Ukraine War. He is demanding Europe puts pressure on India and China by immediately imposing 100% tariffs upon them! Wow.. when did Trump become President of Europe?
The collapse of Trump’s efforts to be the Global Peacemaker now risks backfiring on the USA. Rather than looking a strong global policeman, whose mere glance could cow recalcitrant nations into conformity, the USA now looks weak and increasingly irrelevant under their mercurial leader. Both Russia and Israel are taking advantage of Trump’s increasing dither and unpredictability. He won’t confront strength. He blames his allies for their gains.
There was always a danger the recent spectacular self-abasement and fawning adulation of European leaders towards the King of America would backfire. He now seems to believe they worship him and will fawn upon his every bidding.
The problem is… Europe would be insane to declare trade war on Asia to disguise Trump’s misculations. Asia is where the future lies – not the USA. Yet, refusing to enact tariffs will give Trump the excuse he needs to blame Europe and walk away. The cost will be the de-facto ending of the current efforts to keep Trump on side. It will mean a riven Nato and Russia will be empowered to step up its attacks on Ukraine.
In the USA Scott Bessent was recently on TV, telling the audience with a straight face that tariffs were not a tax on them, and they were not paying the tariff costs. Europe knows better. No one in Europe believes tariffs are an effective trade policy tool – they are a tax on domestic consumption. They will only make already disrupted supply lines more broken. Europe would prefer diplomacy to address issues, rather than outright trade war.
India has joined the China/Russia axis because Trump mortally insulted Premier Modi and India by claiming credit for the recent ceasefire agreed with Pakistan. India rejected any US intervention and made clear it was a regional matter – Trump still blazed in and made a complete a*se of himself. It has cost the USA credibility across Asia.
Indian entrepreneurs have made off like bandits importing cheap Russian oil $15-20 below market price, and then re-exporting – often to Europe. (Long experience in global markets teaches many things – one is that Indians are utterly transactional. A win is a win, and they will always take it.) However, the only actual loser is Russia which has lost 30% of its potential commodity earnings! (Yes, how hypocritical that Europe is buying Indian oil…. Get over it.)
The failure was stopping Russia’s ghost fleet of decaying tankers from traversing the world’s oceans following the stopping of the NordStream pipelines and sanctions. The stopping of Russian exports was never enforced.
Now Trump wants Europe to tariff China 100% – when he himself TACOed out of a China trade war because of the USA’s vulnerability to Chinas dominance of Rare Earths. Europe’s response should be no. Trump kicked the hornets nest – let him deal with the consequences. But let’s see what happens.
It’s a messy world out there.. A reckoning is coming.
Out of time, and back to the day job..
Bill Blain
CEO – Windshift Capital
Author – The Morning Porridge
Partner – Shard Capital
