Starmer is oblivious to how formidable Trump really is
Like the Rest of Europe, Starmer Has Yet to Wake Up and Smell the Coffee over Trump
The President is Following Through on Long-promised Policies – Our Leaders Remain Woefully Unprepared
“Hope for the best, prepare for the worst.” This timeworn piece of wisdom has echoed through the ages, yet rarely do we see it properly implemented. Throughout history, we have witnessed countless instances where the failure to prepare has led to catastrophic consequences. Rather than taking precautionary measures, humanity has consistently demonstrated a predilection for merely hoping circumstances will turn out favourably. Whilst this approach occasionally proves successful, more often than not, it results in dire consequences.
One cannot claim ignorance in the face of clear warnings. Donald Trump has never attempted to obscure his evident sympathies towards Vladimir Putin. His campaign pledge to resolve the Ukrainian conflict has been a consistent feature of his presidential aspirations, and he has repeatedly admonished fellow NATO members about their perceived parasitic relationship with America, urging them to shoulder a greater portion of their defence responsibilities.
Nevertheless, the spectacle of Trump actually implementing his stated policies has caught European leaders entirely wrong-footed. They find themselves in an embarrassingly vulnerable position, grotesquely unprepared for the severe security challenges that Trump’s actions present. Having shamelessly exploited the post-Cold War “peace dividend”, they now stand exposed and defenceless before the gathering storm.
Much to the Kremlin’s unbridled delight, Trump’s America has effectively switched allegiances. The long-standing bonds of the Western alliance have been all but severed in favour of sacrificing Ukraine’s interests. Trump now regularly parrots Russian propaganda with troubling enthusiasm – propagating such dubious claims as Volodymyr Zelensky being a dictator with merely 4 per cent popular support, and the patently false assertion that America’s military aid to Ukraine significantly outweighs European contributions.
Assuming Trump’s declarations reflect genuine intent, we stand on the precipice of one of the most significant geopolitical upheavals of the modern era. We are witnessing a dramatic deviation from the post-war settlement that has underpinned international relations for decades.
The dangers facing Europe could scarcely be more apparent. Putin, emboldened by his territorial acquisitions in Ukraine, appears poised to expand his imperial ambitions towards the Baltic states and other regions of Eastern Europe. There is little evidence to suggest that Trump would be inclined to defend Latvia, Lithuania, or Estonia in such circumstances.
Whilst one ought not to draw direct parallels between geopolitical developments and financial markets, the current juxtaposition presents a remarkable spectacle – American and European stock indices hover near their historic peaks, with valuations stretched to seemingly unsustainable levels.
European political leaders are not alone in their lack of preparation for adverse scenarios; markets appear equally oblivious to looming threats. The sole apparent indicator of trouble manifests in the gold price, which likewise approaches its historic zenith, albeit for markedly different reasons. Gold has long served as the ultimate safe haven during periods of uncertainty.
The surge in demand has placed considerable strain on the Bank of England’s capabilities. Requests for bullion shipment slots have reached their highest levels in decades. Such is the volume that Sir Dave Ramsden, one of the Bank’s deputy governors, recently found his commute impeded by a lorry in the bullion yard awaiting its cargo of gold bars.
The Bank of England maintains its position as the world’s second-largest gold depository, surpassed only by the New York Federal Reserve. However, it is worth noting that merely 5.4 per cent of the 420,000 gold bars housed within the Bank’s vaults actually belong to the nation. The remainder is held on behalf of commercial entities and other central banks.
This modest national holding might have been more substantial were it not for Gordon Brown’s inexplicable decision to dispose of a significant portion of the nation’s gold reserves at historically low prices during the late 1990s – a decision that continues to perplex financial analysts to this day.
Since Trump’s election to the presidency, more than 20 million troy ounces of gold, valued at approximately £47 billion, have been transferred to New York’s Comex exchange depositories, with a substantial portion originating from the London gold market. This robust demand has created opportunities for arbitrage between spot and futures prices. Additionally, traders harbour concerns regarding potential Trumpian tariffs on gold shipments.
However, underlying this modern gold rush lies a more profound catalyst – the unmistakable sight of the established world order being shaken to its very foundations.
Stock markets, conversely, appear to maintain an almost Panglossian outlook regarding the future. Rather than recognising the Carthaginian peace likely to be imposed upon Zelensky for what it truly represents – a component of a perilous deterioration in international relations – they appear inclined to view it, much like Trump, as a potential escape route from an otherwise interminable war of attrition.
The markets appear to believe that normalised relations with Russia could lead to the restoration of regular trade patterns, alleviating pressure on European budgets, enhancing business opportunities, and reopening access to affordable energy resources.
From the White House’s perspective, Zelensky bears significant responsibility for recent developments. According to reports, he had previously indicated to the United States his willingness to concede mineral rights as part of a security arrangement underpinning a peace agreement.
Scott Bessent, the US Treasury Secretary, recently elaborated on this point during a Bloomberg TV interview: “The sequencing of what was going to happen was: bring the Ukrainians closer to the US through economic ties, convince the American people, the American public, get them onside. The US, with greater economic interest in Ukraine, provides a security shield.”
However, Bessent contends that Zelensky subsequently reneged on this arrangement and made what were deemed “inappropriate remarks” at the Munich Security Conference. “He assured me that he would sign the minerals deal, but he has not,” Bessent maintained.
Regardless of the precise details, relations between the United States and the remainder of the G7 have deteriorated substantially. Sir Keir Starmer’s prospects of ameliorating this situation during his scheduled meeting with Trump appear decidedly slim.
The Prime Minister represents yet another relatively insignificant player on this grand stage. His modestly ambitious pledge to increase defence spending from 2.33 per cent of GDP to 2.5 per cent falls so far short of Trump’s demands as to appear almost disrespectful.
Like many European leaders, Starmer appears not to have fully grasped the gravity of the situation. The threat posed by Putin necessitates not only substantially increased funding but a comprehensive reimagining of defence budget allocation, with particular emphasis on shifting resources from naval to land-based capabilities. Meanwhile, the Government continues to demonstrate dangerous complacency in the face of mounting threats.
The old adage suggests one cannot have both guns and butter, yet when presented with this choice, Europe consistently prioritises welfare spending. This paradigm has become obsolete, though politicians remain reluctant to acknowledge this reality.
This misapprehension extends beyond the political sphere. Current stock market valuations appear to reflect a bygone era, eerily reminiscent of another historical parallel. In the early summer of 1914, as war drums grew increasingly audible, markets maintained their complacent optimism, with prices remaining near historic peaks.
It was not until mobilisation began in earnest that investors finally recognised their precarious position. The ensuing panic proved so severe that stock markets worldwide suspended trading for extended periods, whilst in Britain, the entire banking system required nationalisation to prevent complete collapse.
The parallels with our present situation are both striking and deeply troubling, suggesting that both political leaders and financial markets may be sleepwalking towards another potentially catastrophic failure of preparation.