As a Trader, I’ve come to realize that geopolitics isn’t just background noise—it’s the main stage event. The Trump tariffs and the ongoing trade war between the USA and China are perfect examples. These events aren’t abstract political dramas; they’re directly reshaping markets, moving money globally, and impacting how I approach trading every day.
When I first started trading, I preferred neatly measured risks. It felt safer to focus on quantifiable things—numbers, charts, clear trends. But geopolitics refuses to fit into tidy boxes. Over time, I’ve learned that ignoring what can’t easily be measured isn’t just risky—it’s dangerous. Geopolitical shifts don’t politely wait outside market boundaries; they storm right in and change the game overnight.
Take Europe, for instance. The stability we’ve taken for granted since World War II is starting to crack. France and Germany, once closely aligned, now disagree sharply on economic policy and debt management. Germany wants more centralized fiscal control within the EU, while many European voters strongly oppose further integration. It’s not peaceful cooperation that’s shifting these borders; it’s heated political discord.
A major concern I’ve been following is the stability of the U.S. dollar as the world’s reserve currency. With China and Russia pushing the BRICS forward and increasing their use of the yuan and ruble for trading commodities, the dominance of the dollar isn’t as secure as it used to be. I keep asking myself: What happens to global markets if the dollar’s supremacy fades? Even considering this question was once unimaginable, but today it’s crucial.
Debt and sovereign risk are also constantly on my radar. Countries burdened by debt often resort to higher taxes and increased regulation, creating friction between governments and citizens. This can rapidly erode trust and stability. As a trader, I depend heavily on states providing fundamental protections like secure property rights and stable laws. Without these, sovereign risks explode, and markets can quickly turn hostile.
Taxes, inflation, confiscation, and expropriation aren’t hypothetical—they’re real risks I track regularly. Even economically robust nations can experience sudden investor panic if financial stability starts slipping. Understanding these risks helps me stay prepared rather than getting blindsided.
Predicting geopolitical events precisely isn’t feasible—anyone claiming they can is mistaken. Instead, my focus has shifted towards preparation. My goal is to identify potential risks, imagine plausible scenarios. Constant vigilance—tracking regime changes, territorial conflicts, or economic warfare—is part of my daily routine.
Central banks also play a huge role in managing geopolitical impacts. Their quantitative easing and prolonged low-interest policies have given markets a sense of artificial stability. But I’m wary; complacency here can be dangerous. Central banks can shift gears abruptly, triggering sharp corrections. I never forget that states have the power to print money, tax aggressively, and even expropriate assets if conditions demand it.
Going forward, ignoring geopolitics isn’t an option for serious traders. Borders can dissolve, alliances shift, and seemingly stable governments can falter unexpectedly. Integrating geopolitical risk assessments into my strategies isn’t just advisable—it’s essential.
At Takezo Trading, I see geopolitics not as an abstract concern but as central to informed, successful trading. Being alert, adaptable, and prepared for geopolitical changes isn’t merely good practice—it’s a critical part of surviving and thriving in today’s financial world.