Business

1. Selling the big, beautiful bill
2. Selling America?
3. Dollar dinged
4. Jingoism everywhere

Happy early Fourth of July to our US readers.

Leaning into Independence Day, today we’re looking at America’s role in the global economy, which is at an inflection point. The US is no longer a trusted ally or a safe financial haven. But my conversations with executives and investors can be summed up as: Where else are they going to go?

“The cleanest dirty shirt,” is how Mike Wilson, the chief investment officer at Morgan Stanley, put it to me this week. This worldview, of course, has an acronym — not the TACO trade, but the TINA trade: There is no alternative.

In part, that’s because things remain pretty good in the US, which has the deepest capital markets and most dynamic companies in the world, plus a workforce that refuses to quit. (See today’s strong jobs report.) Global investors may not love what’s happening here — ballooning budget deficits, political instability, and a retreat from the global stage — but there’s simply nowhere else to go. Foreigners own $62 trillion of US assets and would be hard-pressed to find new homes for that money, even with European countries issuing new debt and strong-arming their institutions to invest domestically. “The bumper sticker,” Wilson tells me, “is that the US is still a safe asset, but at a different price.”

The world is transitioning, to use an airline analogy, from a hub-and-spoke model to a point-to-point model. A global economy that flowed through the US (read: New York) and, to a lesser degree, European capital centers and Japan is being replaced by bilateral ties, negotiated messily and in front of the cameras. As any frequent flier will know, the result is a system that’s less efficient and more expensive, but with fewer single points of failure.

‘Big, beautiful bill’ faces the public next

The House is on the verge of passing Republicans’ sweeping tax cuts-and-spending bill, overcoming resistance from its conservative flank and delivering a big victory to President Donald Trump. Congressional leaders met overnight Wednesday with resistant members, who said the bill that emerged from the Senate’s own boisterous process didn’t cut enough in spending or salvage enough of Medicaid. The passage of the bill, which is expected to reach the president’s desk ahead of his July 4 deadline, will be a testament to Trump’s sway over his party. Then comes the next challenge: Selling it to the public. One in five Medicaid enrollees under age 65 identify as MAGA.

The ‘great rotation’ that isn’t

The death-of-American-exceptionalism crowd has never been louder, but there’s little evidence in the stock market. The S&P 500 has caught up to global indexes in recent months, and the “great rotation” out of the US and into foreign assets is starting to look overcooked.

“It feels like narratives really got carried away,” BlackRock global chief investment strategist Wei Li tells Semafor. “There is something really exceptional about US corporates,” Li said, noting that S&P 500 companies overdelivered this earnings season.

HSBC experts similarly noted that a previous surge of investments out of the US and into Europe seems to be slowing. “We think the ‘sell America’ story goes too far,” Morgan Stanley’s Chief Investment Officer Mike Wilson said.

The dollar is on shaky ground

The US dollar is on track for its worst year in modern history and may not be done falling yet. The greenback is down more than 7% this year and Morgan Stanley predicts it could fall another 10%. A weaker dollar could make US exports more competitive, boosting Trump’s plan to rebalance US trade, but makes imports more expensive, adding to the sting of tariffs.

The question ahead is whether the dollar doesn’t just lose its value, but its role at the center of the global financial system. So far, there are few alternatives. And efforts to de-dollarize — central banks shifting into gold, China shoveling its currency into developing nations through swap lines — haven’t meaningfully shifted the picture. But as political economist Ngaire Woods wrote for Semafor in an essay earlier this year, “they haven’t dethroned the dollar, but that’s because the US government has protected it through sound policy and global engagement.”

Food for thought: The year that came closest to 2025 in dollar depreciation was 1973, and the result was then-President Richard Nixon taking the US off the gold standard. “Big moves in the dollar tend to create moments of instability,” Morgan Stanley’s Wilson said.

The secret to Zohran Mamdani’s winning strategy is simpler than you think. The once-little-known lawmaker shocked New York by winning the Democratic primary for mayor — thanks in large part to vertical videos that actually broke through. This week on Mixed Signals, Ben and Max talk to the candidate’s media team, Rebecca Katz, founder of the political ad agency Fight, and Morris Katz (no relation), the lead media strategist for the campaign. They get the behind-the-scenes scoop on how viral videos like “Halalflation” came about, why Mamdani’s videos worked, and what future political campaigns can learn from his success.

Jingoism is on the rise everywhere

Trump’s trade deals are so far light and fraught, as leaders around the world, managing their own voters, are pushing back. With the July 9 deadline for the end of a pause on reciprocal tariffs looming, US trading partners are managing tricky domestic constituencies while keeping the world’s biggest economy onside.

It’s a delicate balancing act. Canada’s new prime minister met Trump’s bullying with strength, but caved on its proposed digital services tax, which would have cost American tech companies billions, to get back to the negotiating table. Japan is trying to avoid punishing car tariffs and get access to needed US gas without angering its powerful domestic rice growers, who are protected by tariffs that Trump is seeking to unwind. India is willing to lower its own barriers on US apples, but fiercely protecting its own soybean farmers. Negotiations are said to be stuck on, among other things, allowing freer imports of milk from US dairy farms whose feeding practices conflict with Hindu dietary customs.

The deal announced this week with Vietnam looks like a clearer win for Trump, imposing 20% across-the-board tariffs and 40% on goods routed through Vietnam from China, but details are sparse. Other countries want to be great, too.

➚ BUY: Reality: CEOs are finally starting to say the quiet part out loud — AI will wipe out millions of jobs.

➘ SELL: Distortion. Payroll provider ADP’s dire employment report this week, which showed the US lost jobs for the first time in years, was way off, again. The official government numbers (which include public-sector jobs not captured by ADP) were far rosier.

Tired of financial newsletters that bury the lede, or worse... don’t have one? That’s why over 1 million investors start their day with The Daily Upside. Written by former Wall Street insiders, it cuts through the noise with clear, actionable market insights that actually matter. Subscribe for free and stay ahead.

Companies & Deals

• About-face: Intel’s new CEO is considering throwing out a manufacturing playbook championed by his predecessor, Reuters reports, a move that would require an expensive write-down but could help the company compete against TSMC.
• Oracular spectacular: OpenAI agreed to buy massive amounts of computing power from Oracle, according to Bloomberg. The deal, largely bankrolled by SoftBank, is for enough energy to power more than 3 million homes, but will instead feed the Stargate initiative.
• Boarding call: Activist hedge fund Starboard amassed a $160 million stake in Tripadvisor, which turned down several takeover offers last year to investors’ frustration.
• Crunchtime in Cambridge: Trump’s punitive measures against Harvard would blow a $1 billion hole in the school’s annual budget, according to a WSJ analysis, which explains why administrators have signaled a willingness to negotiate with the White House.

Watchdogs

• Chips down: The Trump administration lifted restrictions on the sale of US chip designs to China, a boon for companies like Siemens and Synopsys. That could pave the way for Synopsys’ pending takeover of a rival, which is waiting on approvals from China.
• Pointers welcome: Chinese officials are seeking advice from European banks on how to handle low interest rates. Beijing has cut borrowing costs to try to jolt its economy but risks hurting its own bank’s profitability, and is seeking to avoid a deflationary spiral.
• En garde, en masse: More than 40 CEOs asked European regulators to call off sweeping AI rules set to take effect next month, warning it will hurt the region’s competitiveness.

Markets

• Reasonable rate of return: After sailing through federal stress tests, big US banks are sitting on piles of cash that the government says they no longer need. The question is what they do with all that money: Banks quickly announced increases to their shareholder dividends, but the temptation to spend cash burning a hole in CEOs’ pockets will be high.
• Intimidating everybody: UK bond investors dumped gilts after Prime Minister Keir Starmer abandoned plans to trim welfare spending.

The Trump administration is thinking about trying to void naturalized immigrants’ citizenship — potentially starting with New York City mayoral primary winner Zohran Mamdani, Semafor’s David Weigel writes.

Asked Monday about Tennessee Rep. Andy Ogles’ proposal to strip Mamdani, who was born in Uganda but became a citizen in 2018, of his legal status, White House press secretary Karoline Leavitt said it’s “something to be investigated.” The suggestion infuriated Democrats; Sen. Chris Murphy, D-Conn., called it “racist bullsh*t.”