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| In Davos, Financiers Bewildered by Global Uncertainty | In Davos, Financiers Bewildered by Global Uncertainty |
| (about 3 hours later) | |
| DAVOS, Switzerland — For the investors and market-movers at the annual World Economic Forum here, a threat lurks. | DAVOS, Switzerland — For the investors and market-movers at the annual World Economic Forum here, a threat lurks. |
| At cocktail parties where the Champagne flows, financiers have expressed bewilderment over the rise of populist groups that are feeding a backlash against globalization. In the halls of the Davos Congress Center, where many of the meetings this week are taking place, investors have tried to make sense of the political upheaval. | At cocktail parties where the Champagne flows, financiers have expressed bewilderment over the rise of populist groups that are feeding a backlash against globalization. In the halls of the Davos Congress Center, where many of the meetings this week are taking place, investors have tried to make sense of the political upheaval. |
| The world order has been upended. As the United States retreats from the promise of free trade, China is taking up the mantle. The stark shift leaves investors trying to assess the new risk and opportunities in the global economy. | The world order has been upended. As the United States retreats from the promise of free trade, China is taking up the mantle. The stark shift leaves investors trying to assess the new risk and opportunities in the global economy. |
| “This is the first time there is absolutely no consensus,” said William F. Browder, co-founder of Hermitage Capital Management, who has been coming to Davos for 21 years. “Everyone is looking into the abyss.” | “This is the first time there is absolutely no consensus,” said William F. Browder, co-founder of Hermitage Capital Management, who has been coming to Davos for 21 years. “Everyone is looking into the abyss.” |
| The religion of the global elite — free trade and open markets — is under attack and there has been a lot of hand-wringing over what Christine Lagarde of the International Monetary Fund has declared a “middle-class crisis.” | The religion of the global elite — free trade and open markets — is under attack and there has been a lot of hand-wringing over what Christine Lagarde of the International Monetary Fund has declared a “middle-class crisis.” |
| But while everyone has a view on the state of the world, there is little agreement on how to deal with it. | But while everyone has a view on the state of the world, there is little agreement on how to deal with it. |
| The biggest concern? Finding a way to make the people who are driving populist movements feel like they are part of the global economic pie that Davos participants have created and largely own. | The biggest concern? Finding a way to make the people who are driving populist movements feel like they are part of the global economic pie that Davos participants have created and largely own. |
| In a Twitter post from the Swiss resort, Ian Bremmer, the president of Eurasia Group, a political-research firm, offered his advice: “Elites won’t be able to manage populism until they stop seeing it as a threat and start seeing it as a symptom.” | In a Twitter post from the Swiss resort, Ian Bremmer, the president of Eurasia Group, a political-research firm, offered his advice: “Elites won’t be able to manage populism until they stop seeing it as a threat and start seeing it as a symptom.” |
| If that is the case, Davos has, so far, made little progress. | If that is the case, Davos has, so far, made little progress. |
| “I want to be loud and clear: Populism scares me,” Ray Dalio, the billionaire hedge fund manager, said during a panel on how to fix the middle-class crisis. “The No. 1 issue economically as a market participant is how populism manifests itself over the next year or two.” But Mr. Dalio offered little by way of a solution, beyond opining on the positive aspects of loosening regulation and lowering taxes. | “I want to be loud and clear: Populism scares me,” Ray Dalio, the billionaire hedge fund manager, said during a panel on how to fix the middle-class crisis. “The No. 1 issue economically as a market participant is how populism manifests itself over the next year or two.” But Mr. Dalio offered little by way of a solution, beyond opining on the positive aspects of loosening regulation and lowering taxes. |
| On the subject of rising populism, Mr. Dalio, who runs the $150 billion investment firm Bridgewater Associates, added: “It’s an anti-Davos way of operating.” | On the subject of rising populism, Mr. Dalio, who runs the $150 billion investment firm Bridgewater Associates, added: “It’s an anti-Davos way of operating.” |
| Jack Ma, the founder of Alibaba in China, offered his view of the problem in the United States. Americans, he said, “do not distribute the money properly.” | Jack Ma, the founder of Alibaba in China, offered his view of the problem in the United States. Americans, he said, “do not distribute the money properly.” |
| If there was one thing that Davos agreed on last year, it was that Donald J. Trump wouldn’t win the United States presidential election. | If there was one thing that Davos agreed on last year, it was that Donald J. Trump wouldn’t win the United States presidential election. |
| And so this year, with Mr. Trump’s inauguration on Friday coinciding with the end of the World Economic Forum, every conversation has drifted to one question: What will the Trump presidency look like, and what will it mean for business? | And so this year, with Mr. Trump’s inauguration on Friday coinciding with the end of the World Economic Forum, every conversation has drifted to one question: What will the Trump presidency look like, and what will it mean for business? |
| To many American financiers who once opposed Mr. Trump’s candidacy, the prospect of fewer regulations and a blank slate with a new leader has assuaged some of the fear about uncertainties. At the forum, some attendees have been thrust into a role of interpreting the president-elect to a befuddled global elite. | To many American financiers who once opposed Mr. Trump’s candidacy, the prospect of fewer regulations and a blank slate with a new leader has assuaged some of the fear about uncertainties. At the forum, some attendees have been thrust into a role of interpreting the president-elect to a befuddled global elite. |
| “He’s not necessarily communicating in a way that the people in this community would love,” said Anthony Scaramucci, a hedge fund regular at Davos and onetime critic of Mr. Trump who is now set to join the administration in the roles of public liaison and adviser. “But he is communicating very, very effectively to a very large group of the population in Europe and the U.S. that are feeling a common struggle right now.” | “He’s not necessarily communicating in a way that the people in this community would love,” said Anthony Scaramucci, a hedge fund regular at Davos and onetime critic of Mr. Trump who is now set to join the administration in the roles of public liaison and adviser. “But he is communicating very, very effectively to a very large group of the population in Europe and the U.S. that are feeling a common struggle right now.” |
| Mr. Scaramucci promised that Mr. Trump had “the utmost respect for Angela Merkel,” the German chancellor who was the subject of an attack by the president-elect this week; that he was in fact a champion of free trade; and that he wanted to have a “phenomenal relationship with the Chinese” despite his fiery anti-China rhetoric. | Mr. Scaramucci promised that Mr. Trump had “the utmost respect for Angela Merkel,” the German chancellor who was the subject of an attack by the president-elect this week; that he was in fact a champion of free trade; and that he wanted to have a “phenomenal relationship with the Chinese” despite his fiery anti-China rhetoric. |
| Soon after his appearance on a panel, Mr. Scaramucci was on a plane heading to Washington to attend Mr. Trump’s inauguration. But his words still resonated, mainly because they were being broadcast on the giant screen behind a coffee bar where World Economic Forum participants congregated between meetings. | Soon after his appearance on a panel, Mr. Scaramucci was on a plane heading to Washington to attend Mr. Trump’s inauguration. But his words still resonated, mainly because they were being broadcast on the giant screen behind a coffee bar where World Economic Forum participants congregated between meetings. |
| Another Davos regular, the billionaire investor Paul Singer, did not attend this year. Mr. Singer, a vociferous critic of Mr. Trump for most of the election campaign, was instead making his way to Washington for the inauguration, having recently donated $1 million to the event. | Another Davos regular, the billionaire investor Paul Singer, did not attend this year. Mr. Singer, a vociferous critic of Mr. Trump for most of the election campaign, was instead making his way to Washington for the inauguration, having recently donated $1 million to the event. |
| One major investor has remained unchanged in his views about Mr. Trump, however. | One major investor has remained unchanged in his views about Mr. Trump, however. |
| George Soros, the investor and philanthropist who has called Mr. Trump “a con man,” hosted a dinner on Thursday evening in Davos, during which he said that Mr. Trump “would be a dictator if he could get away with it.” This was unlikely to happen, he added, because of strong democratic institutions in the United States. | |
| For those who have been puzzled over market euphoria since Mr. Trump’s election, Mr. Soros put it this way: “Markets see Trump dismantling regulations and reducing taxes — and that has been their dream.” | |
| But Mr. Soros, who became known as the man who broke the Bank of England with a bet against the British pound in 1992, added that he was convinced that Mr. Trump would fail. “I don’t think the markets are going to do very well,” he said. | |
| When President Xi Jinping addressed the Davos forum, becoming the first Chinese head of state to do so, his message was clear: China is ready for the world stage. He championed free trade and open markets, setting the tone for the week. | When President Xi Jinping addressed the Davos forum, becoming the first Chinese head of state to do so, his message was clear: China is ready for the world stage. He championed free trade and open markets, setting the tone for the week. |
| On the sidelines, the country’s business leaders echoed that sentiment. | On the sidelines, the country’s business leaders echoed that sentiment. |
| Among the delegation that arrived in Davos with Mr. Xi were some of China’s biggest business leaders including Mr. Ma, Wang Jianlin of Dalian Wanda, and top executives from Baidu, Huawei Technologies and China Telecom. Through the week, they have been meeting with investors and talking deals with erstwhile partners. | Among the delegation that arrived in Davos with Mr. Xi were some of China’s biggest business leaders including Mr. Ma, Wang Jianlin of Dalian Wanda, and top executives from Baidu, Huawei Technologies and China Telecom. Through the week, they have been meeting with investors and talking deals with erstwhile partners. |
| With Mr. Xi’s help, China has fashioned itself here as a new leader of the free-market world. | With Mr. Xi’s help, China has fashioned itself here as a new leader of the free-market world. |
| “I wasn’t sure if it was President Xi or Ronald Reagan,” joked Thomas W. Farley, president of the New York Stock Exchange. At a lunch with Mr. Ma of Alibaba, Mr. Xi was quoting Abraham Lincoln, Mr. Ma told a small group of participants on Wednesday. | “I wasn’t sure if it was President Xi or Ronald Reagan,” joked Thomas W. Farley, president of the New York Stock Exchange. At a lunch with Mr. Ma of Alibaba, Mr. Xi was quoting Abraham Lincoln, Mr. Ma told a small group of participants on Wednesday. |
| It was a message somewhat at odds with the historical roots of China’s ruling Communist Party. And back in Washington, Wilbur Ross, Mr. Trump’s nominee for commerce secretary, did not mince words, calling China “the most protectionist” major economy, setting the stage for a possible trade war. | It was a message somewhat at odds with the historical roots of China’s ruling Communist Party. And back in Washington, Wilbur Ross, Mr. Trump’s nominee for commerce secretary, did not mince words, calling China “the most protectionist” major economy, setting the stage for a possible trade war. |
| But in Davos, there was a sense that change in the economic order was afoot. | But in Davos, there was a sense that change in the economic order was afoot. |
| Alicia Bárcena Ibarra, who heads the United Nations Economic Commission for Latin America and the Caribbean, told a small group that China could soon overtake the United States when it comes to importance in Latin America. | Alicia Bárcena Ibarra, who heads the United Nations Economic Commission for Latin America and the Caribbean, told a small group that China could soon overtake the United States when it comes to importance in Latin America. |
| She described how on the same day last year that Mr. Trump told the world he would not sign the Trans-Pacific Partnership, Mr. Xi arrived for a summit meeting in Chile. | She described how on the same day last year that Mr. Trump told the world he would not sign the Trans-Pacific Partnership, Mr. Xi arrived for a summit meeting in Chile. |
| “So can you imagine the impact when he came talking about free trade as he did this morning?” she said, referring to Mr. Xi’s address on Tuesday in Davos. “China now is the second most important trade partner of Latin America after the U.S.” | “So can you imagine the impact when he came talking about free trade as he did this morning?” she said, referring to Mr. Xi’s address on Tuesday in Davos. “China now is the second most important trade partner of Latin America after the U.S.” |
| “Maybe this is going to change,” she added. “Very soon.” | “Maybe this is going to change,” she added. “Very soon.” |