Zelenskyy Just Rescued Trump

Zelenskyy Just Rescued Trump

Yes, you read the subject line of today’s edition right: Ukraine’s President Volodymyr Zelenskyy just pulled Donald Trump’s chestnuts out of the fire.

We won’t dwell on the who, what, when and where of the spectacle at the White House on Friday. You’re familiar with it by now.

Although, as Matt Taibbi writes at his Racket News page on Substack, “It takes a special type of person to show up uninvited to the White House and accuse the president of being Putin’s bitch in the middle of demanding continued billions from him in military support.”

We’re seeing much online chatter suggesting that Trump and Vice President Vance somehow “ambushed” Zelenskyy — and maneuvered him into making a fool of himself.

But the evidence is unpersuasive.

“Anyone who rationally watches the full 50 minutes will see it was not an ‘ambush,’” tweets independent journalist Michael Tracey.

“The first 40 minutes were normal and cordial. Then came the self-inflicted meltdown by Zelenskyy.”

But don’t take it from us. Take it from Treasury Secretary Scott Bessent.

On the Sunday talk show circuit Bessent made it clear that Trump was ready to sign a deal on Friday — in which the U.S. government would gain access to the proceeds from an “investment fund” that would develop Ukraine’s mineral resources.

“All President Zelenskyy had to do was come in and sign this economic agreement, and again show no daylight — no daylight — between Ukrainian people and the American people, and he chose to blow that up,” he told CBS.

Bessent went on to say the deal aimed “to further intertwine the American people and Ukrainian people and show no daylight. To show the Russian leadership that there was no daylight. And President Zelenskyy came into the Oval Office and tried to relitigate in front of the world the deal.”

Just two days before the meltdown in the Oval Office, we observed that the minerals deal was a sign Trump was failing his “Vietnam moment.” But Zelenskyy came to Trump’s rescue — even if he didn’t intend to.

Daniel McAdams, director of the Ron Paul Institute, addressed Trump on X: “You have escaped a potentially disastrous entangling alliance - this time with a guy who craps in your office and insults you to your face.

“You have now an INCREDIBLE opportunity to WALK AWAY from Joe Biden's IDIOTIC proxy war with Russia through Ukraine. You will come out smelling like a rose - if you just walk away!”

At the moment, that seems to be how events are shaping up: Treasury Secretary Bessent said yesterday the minerals deal is no longer on the table.

In addition, The Washington Post reports that Trump is now thinking about cutting off all U.S. weapons shipments to Ukraine.

“I don’t know if we can ever do business with Zelenskyy again,” says Trump ally Sen. Lindsey Graham (R-South Carolina) — who’s visited Ukraine nine times since the war began three years ago.

Matt Taibbi: “Trump now can’t remain committed to Ukraine even as a threatened option in negotiations, since Zelenskyy just arranged it so that Trump will look like he surrendered to his suitless ‘ally’ if he does.”

Still, the present moment is fraught with danger.

European leaders met over the weekend with Zelenskyy “to forge a Ukraine peace plan to present to President Trump,” as this morning’s Wall Street Journal puts it.

At this stage it seems unlikely Trump would bite on anything they come up with. (Which is one reason why shares of European defense stocks like Germany’s Rheinmetall and Italy’s Leonardo leaped as much as 15% today.)

But there’s always the risk of a provocation — some sort of “incident” that would trap Trump and pull him back into the morass.

Even if Zelenskyy is finished, “I doubt those who have long lusted for Russian blood are quite ready to concede defeat,” tweets the military analyst William Schryver. “So we are now at a dangerous crossroads. If there is a last desperate play left to make, it will come soon.”

“This is a five-alarm fire,” adds the military affairs podcaster Bill Buppert. “NATO is trying to go kinetic against an armed nuclear power for no satisfactory reason that improves the national security posture of America.”

Addressing Trump, Buppert writes, “It is time to start the emergency Time Phased Force Deployment Data (TPFDD) process to return all American troops and their dependents home from Europe starting with the U.K.… Whatever equipment that can’t be returned, destroy it in place.”

As we did last week, we give the last word to Paradigm’s macroeconomics maven Jim Rickards. As he put it earlier in February, “Trump can’t afford to become consumed by Ukraine if he wants to achieve the rest of his agenda on trade, immigration and real growth.”

[Editor’s note: What do you think? Do you think Trump and Vance laid a trap? Or did Zelenskyy sabotage himself? And do you worry about the near future? Write here: feedback@paradigmpressroom.com]

The Crypto Pop-and-Drop

The big market story today is crypto — which shot higher yesterday on the heels of a Trump announcement…

Someone must have reminded him he overlooked something important and so he then added: “And, obviously, BTC and ETH, as other valuable Cryptocurrencies, will be at the heart of the Reserve. I also love Bitcoin and Ethereum!”

Bitcoin leaped from about $85,000 to over $92,000 almost instantly. Many other cryptos followed suit.

Now the buzz is wearing off, Bitcoin at $90,465 — basically back to last Tuesday’s levels.

Bloomberg ventures the reserve concept “was greeted with skepticism in the industry, with investors questioning the project’s merits.”

Well, yes. We said as much in the form of a meme last summer after Trump talked up the reserve idea at the big Bitcoin conference in Nashville…

Perhaps we’ll get some more detail, real meat on the bones, when White House crypto and AI czar David Sacks convenes an industry summit on Friday.

As for more traditional asset classes, stocks are a mixed bag to open the new week after getting roughed up last week.

At last check the Dow is slightly in the green and the Nasdaq is slightly in the red. The S&P 500 is almost pancake-flat at 5,955 and down about 3% from its record close on Feb. 19.

“We’ve got a new price target of 5,535. That’s only a 7% drop,” writes Rude Awakening editor Sean Ring in his chart-a-palooza that he publishes on the first business day of each month.

“If you’re an optimist, it’s a nice breather. If not, it’s the beginning of something more sinister.”

Gold is trying to pick itself up off the floor after last week’s pummeling — up $27 as we write to $2,884. Silver’s up 61 cents to $31.72.

Crude, which ended last week below $70, has shed another 50 cents to $69.26.

The lone economic number of the day is the February ISM manufacturing index — in positive territory for a second-straight month, after 26 straight months of readings suggesting the U.S. factory sector was shrinking.

Bad Look

Coincidentally or not, Trump’s crypto reserve announcement gets a rather different Trump-crypto story out of the news cycle.

The Securities and Exchange Commission is dropping market-manipulation charges against Justin Sun, the man behind the Tron cryptocurrency among other crypto ventures.

To be precise, SEC lawyers asked a federal judge to put the case on hold: “In this case,” they said, “the parties submit that it is in each of their interests to stay this matter while they consider a potential resolution and agree that no party or non-party would be prejudiced by a stay.”

Sun happens to be a leading investor in World Liberty Financial — the crypto project backed by the Trump family. He’s bought $75 million of World Liberty tokens.

Maybe there’s nothing untoward about any of this. But it’s an awful look only a few weeks on the heels of the TRUMP and MELANIA memecoins.

We already called Sun’s ethics into question last year — when he complained about the tone of a CoinDesk article discussing his $6.2 million purchase of an “artwork” featuring a banana duct-taped to a wall.

Because Tron is a major sponsor of CoinDesk’s annual Consensus conference, it seems Sun leaned on management hard enough that CoinDesk nuked the article from its website and let go three top editors.

Anyway, the judge in the market-manipulation case agreed to put the case on pause. As the Gizmodo site sums up, “Sun’s legal troubles seem to be fading away.”

You Can’t Ignore India

“You can love India, or you can hate India. But you cannot ignore India.”

Our own Jim Rickards heard that saying, or a variation on it, frequently during a two-week visit recently.

He marvels at India’s growth since his first visit over 40 years ago. “You cannot ignore India in any geopolitical analysis or portfolio allocation,” he says.

“I spent time with locals in Dharavi, sometimes called the world’s largest slum although Indians take offense at the word slum,” says Jim. Dharavi packs 1 million people into about one square mile of Mumbai.

“The dirt, lack of sanitation and unsafe working conditions in Dharavi were undeniable,” he allows. “Still, what impressed me most was the sheer energy of the place. Thousands of small businesses, including many manufacturing operations, were thriving. They were all hole-in-the-wall arrangements. Labor costs were minimal, regulation almost nonexistent and many appeared unsafe with open fires, exposed machinery and dark working conditions.

“Remarkably, it is estimated that annual revenues from the businesses in Dharavi exceed $1 billion.”

A cardboard recycling business in the heart of Dharavi [Jim Rickards photo]

Jim says India is best thought of as a country with 1.1 billion impoverished people and 300 million more leading a comfortable life.

Note that 300 million number. “A U.S.-sized middle-class population already exists in India,” he says, “with 1.1 billion more people waiting to join the ranks. The growth potential is almost beyond comprehension.

“The key to unlocking that growth potential rests with public policy,” Jim adds. Clearing up land titles for the poorest residents will help. “Beyond that, India needs to keep its big-brain technical workers at home instead of watching them head off to the U.S., Australia and Canada.”

Jim believes Prime Minister Narendra Modi has already made strides in those areas over the last decade — and he says it’s no accident that Modi was among the first foreign leaders to visit Donald Trump at the White House.

“Modi’s pragmatic relationship with Trump and India’s enormous growth potential now being unlocked make India the go-to destination for foreign direct investment for the foreseeable future.”

Comic Relief

We wrap up today with an entry from the meme-o-sphere that neatly joins the end of Friday’s edition with the start of today’s…

Best regards,

Dave Gonigam
Managing editor, Paradigm Pressroom's 5 Bullets