Good morning! It’s not everyday the President of the United States calls the Federal Reserve Chairman a “loser,” but that’s what Trump did to Powell to start the week — and the implications go far beyond social media.

Was this email forwarded to you? Join 190,000 self-directed investors gaining an edge every morning. Sign up here. 

Today’s letter is brought to you by BitcoinIRA!

Why smart investors use BitcoinIRA:

• Tax Savings: When you trade in an IRA, you don't have to pay capital gains taxes that can be as high as 37% 

• Top-Level Security: Assets are custodied with a US based custodian and insured up to $250M²

• World Class Customer Service: BitcoinIRA has a team of IRA specialists that will help guide you through every step of the process

Take 3 minutes to open your account & get access to over 75 cryptocurrencies in your IRA.

P.S. As an Opening Bell Daily reader, you can earn up to $500 in rewards* when you add funds to your account.

A falling buck

Today features a guest column from Joseph Wang. He is a former trader on the Federal Reserve’s open markets desk, and operates FedGuy.com. Follow him on X at @FedGuy12.

President Trump will get his new Fed Chair sooner or later, likely one who shares his preference for lower interest rates.

That, combined with trade tensions and political pressure on Jerome Powell, points to a structural weakening of the US dollar. That means foreign investors, long reliant on dollar assets for diversification and safety, will have to reconsider their exposure to US assets.

The dollar’s safe-haven status is eroding and fears of financial repression are mounting. Historically, the dollar strengthens during times of distress, cushioning losses for foreign equity holders.

But that dynamic is breaking down. 

Recent stock market declines have coincided with a falling US dollar, leaving foreign investors with compounding losses across both equities and the currency.

If this regime persists — and if Trump continues to call for Powell’s firing — foreign allocations to US stocks will shrink from their record levels.

The MSCI World Index, a global stock benchmark, places a 72% weight on US equities. Plus, its top ten holdings are US tech stocks.

Public disclosures of major foreign investors reveal a similar US-heavy weighting — the largest equity holdings in Norway’s sovereign wealth fund are all US equities, and major Canadian pension funds have over 40% of their equity exposure to American companies. 

These investors will need to lower their exposure ahead of a widely-anticipated weakening of the dollar.

That adjustment likely means more pain for US stocks before any durable rebound. Once the foreign exodus is complete, however, the stage could be set for a new bull market.

Treasuries, meanwhile, may not see the same pressure. Most foreign holders hedge FX risk, and any rate cuts would lower hedging costs and potentially boost demand.

Some foreigners will exit the market on fears that a less independent central bank will lead to higher inflation, but a sizable portion of foreign Treasury holders are foreign central banks that must hold dollars to manage their currency.

What’s more, declines in the US stock market could also prompt US-based investors to rush into bonds. 

Political control over the central bank is commonly associated with runaway inflation, but that is not the only possibility.

In post-war Japan and in China today, government-directed central banks supported industrial growth. Japan’s central bank wasn’t granted independence until 1997. In both cases, economic coordination worked well.

That may be the model Trump is imagining as he undertakes the task of rebuilding American manufacturing. 

Equities should do very well once foreign investors finish selling. On one hand, Trump could usher in a new era of growth. On the other, the mismanagement of a central bank typically leads to explosive stock gains, too.

Market snapshot

Elsewhere

🏦 Trump really wants Jerome Powell out. He called again on Truth Social for preemptive rate cuts: “With these costs trending so nicely downward, just what I predicted they would do, there can almost be no inflation, but there can be a SLOWING of the economy unless Mr. Too Late, a major loser, lowers interest rates, NOW.” (Truth Social)

📦️ Big retailers meet at the White House. Bloomberg reported Monday that executives from Walmart, Target, Home Depot, and Lowe’s are meeting with President Trump to discuss the impact of tariffs on the industry. (Reuters)

📉 Nvidia stock dropped 4.5%. Chinese tech giant Huawei is reportedly set to begin shipping advanced AI chips as soon as next month while Trump’s export rules leave Nvidia’s H20 chips sidelined. The stock has dropped 29% in 2025. (Yahoo Finance)

Steal Wall Street’s best trades

Elite investors don’t get stock picks from the news. Opening Bell Daily’s Best Ideas Club gives you private access to the under-the-radar trades that top fund managers are making with real capital.

Unlock our library of high-conviction bets and get a new report every Sunday.

Rapid-fire

• Tesla earnings are due after the bell Tuesday, followed by Alphabet Thursday

• Uber stock fell more than 4.5% after the FTC sued the company, alleging it misled its premium subscribers (Reuters)

• More companies are parking imports in tax-free “foreign trade zones” to temporarily avoid tariffs (CNBC)

• Shares of Ford declined as reports emerged that it will stop exporting cars to China (Barron’s)

• Trump’s tariff agenda has raised concerns of weakening capital flows into the US and heightening Treasury market volatility (WSJ)

• Natural gas prices fell to the lowest levels since January as China halted LNG imports from the US (OilPrice.com)

• Pope Francis died Monday at age 88, and the Catholic Church will now choose a new pope (Axios)

Last thing

About me

📰 I’m Phil Rosen, co-founder and editor-in-chief of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, Fortune, Yahoo Finance, Bloomberg and Inc. Magazine.

I write our flagship newsletter to prepare you for each trading day, unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else. Feedback? Reply to this email, ping me on X @philrosenn, or write me directly at [email protected].