Episode 290: France at the Crossroads: Debt, Politics & the Wealth Tax Debate with Susannah Streeter

In this episode, Dominic Bowen and Susannah Streeter discuss financial sector experts and decision makers’ views and warnings on the political instability characterizing France these past few months, and what consequences the accompanying growing debt would lead to on the international scene.

Find out more about what Susannah thinks of such a situation; is it comparable to the Greek financial crisis? Could the Zucman tax ideologies spread to the US and other parts of the world, and have tangible impacts on our economies and societies? Is there room for real concern about France’s future, as one of Europe’s former best student?

The conversation also addresses credit downgrades for France and how these domestic challenges shape Europe’s wider financial stability, raising questions about investor confidence, the credibility of EU rules, and the chain reaction of legislative paralysis in one of the bloc’s largest economies. Dominic and Susannah also examine the renewed debate over taxing the ultra-wealthy, the risks of acting without international coordination, and the difficult balance between competitiveness, fairness, and capital mobility. They also reflect on the contrasting economic dynamics in the United States, what recent market behaviour reveals about global sentiment, and how shifts in policy, growth expectations, and political narratives are reshaping the risk environment for governments and businesses alike. Finally, they address other concerning occurrences in the world, such as the Arctic’s environmental and social challenges, and the growing risks of conflict between China and Taiwan.

Susannah Streeter is a leading financial expert, international broadcaster, and former BBC business anchor who explains global economic, technological, and geopolitical trends to audiences worldwide. Former head of money and markets for the UK’s largest retail investment platform, Hargreaves Lansdowne, she now speaks and moderates at major global events, interviewing CEOs, world leaders, and policy-makers in both English and French. A former RAF Squadron Leader, she brings sharp strategic insight to her analysis, appears across major media outlets, hosts top-performing podcasts, and writes regularly for The Evening Standard and City AM.

The International Risk Podcast brings you conversations with global experts, frontline practitioners, and senior decision-makers who are shaping how we understand and respond to international risk. From geopolitical volatility and organised crime to cybersecurity threats and hybrid warfare, each episode explores the forces transforming our world and what smart leaders must do to navigate them. Whether you’re a board member, policymaker, or risk professional, The International Risk Podcast delivers actionable insights, sharp analysis, and real-world stories that matter.

Dominic Bowen is the host of The International Risk Podcast and Europe’s leading expert on international risk and crisis management. As Head of Strategic Advisory and Partner at one of Europe’s leading risk management consulting firms, Dominic advises CEOs, boards, and senior executives across the continent on how to prepare for uncertainty and act with intent. He has spent decades working in war zones, advising multinational companies, and supporting Europe’s business leaders. Dominic is the go-to business advisor for leaders navigating risk, crisis, and strategy; trusted for his clarity, calmness under pressure, and ability to turn volatility into competitive advantage. Dominic equips today’s business leaders with the insight and confidence to lead through disruption and deliver sustained strategic advantage.

Transcript:

00:00: Susannah Streeter: France has got to respect its pledge to the European Union to curb its budget deficit to 3%% of GDP by 2029. A number of ratings agencies have downgraded Frech debt. There can be this concern over the stability even of the financial system. We’ve seen banking shares take hits as all this political instability has unfolded, and this concern from lots in the financial sector, the holders of government debt, and if that’s devalued to them they’ll have to kind of scramble and cut their losses elsewhere. France is being watched.

00:31: Elisa Garbil: Welcome back to The International Risk Podcast, where we discuss the latest World News and significant events that impact businesses and organizations worldwide.

00:45s: Dominic Bownen: Hi, I’m Dominic Bowen, host of the International Risk Podcast, where we explore the topics that matter. Today, France’s economic situation is really characterised by slow growth, by fiscal challenges, and by political uncertainty. And to unpack why this matters and what it means for international risk, we’re joined by Susanna Streeter. Susanna is an award-winning financial expert. She’s an international broadcaster, a former BBC business anchor. She’s led money and market analysis for the UK’s largest retail and investment platform. She appears regularly across the global media, including the BBC, Wall Street Journal and Bloomberg. And she’s really great to listen to to break down what economic forces are really shaping business and personal finance. So I’m really looking forward to the conversation with Susanna today. Susanna, welcome to the International Risk Podcast.

00:01:26 Susannah: Thank you very much for having me. It’s great to be on the program. And there is so much to talk about, of course, so much going on in the world at the moment. And it is great, actually, to a light on France. France is a country that I have lived in. I’m very, very fond of. In fact, I’m going back to and next week to see old friends. And so I’ve always got a keen interest in what’s happening on ah the other side of the channel.

00:01:48: Dominic Bowen: That’s fair enough. No one ever goes to France and comes back feeling sad, whether it’s the food or the people, it’s always a great place to visit. But whereabouts in the world are you based today?

00:01:56. Susannah:  I’m in Bristol in the southwest of England. And that’s where I’m based most of the time, but I do do a lot of traveling, often in London, but in various other parts of the world as well at various different international conferences. But my base is in Bristol, which is a great part of the world.

00:02:12: Dominic Bowen: It is. it’s It’s beautiful. Well, I mean, we’ll certainly talk about a few things going on around the world and we’ll probably do a little pop through to London and New York during our conversation today. But if we start with France, I mean, France is projected to grow by minuscule 0.6% this year, which is a significant slowdown from, I think it was about 1.1% growth in Now, key sectors like aeronautics, tourism, real estate and agriculture are showing some recovery, but consumer spending and business investment remains weak in France. Inflation is low. it’s actually expected to fall below 1% this year, but unemployment is rising nearly at 8% for this year. And perhaps most concerning is public debt and public debt continues to grow from about 113% a couple of years ago to about 118% next year of GDP. So i’d love to start by hearing your assessment of the economic landscape in in France today.

00:03:14: Susannah:

Yeah, absolutely. i mean, you’ve laid it out pretty well. And it’s not a surprise, really, that because of all of that, there has been this attempt in recent years to get the French to work longer, to try and raise the employment rate, to get the economy ah really moving again, and for the government to show that it’s getting serious about fixing some of the deep-rooted problems in France. And that was partly why and that that pension reform was attempted to be pushed through to raise the legal minimum retirement age from 62 to 64 which has caused so much uproar. And of course, I have been in France for many many years I do know how well the French like to to protest and they’re very good at it as well so many times I’ve been there and the country’s been brought to a standstill and you have to admire the verve of the French in really standing up for what they believe is their right. And this erosion of what they really do believe is a long-term right to retire at that age. And I’ve been speaking to lots of my friends who say, one of them is a fireman, who said, look, you know, I’ve been working at a really, really tough job for many, many years. The thought that perhaps some of my colleagues would have to keep working for so much longer in such a strenuous um job particularly with the forest fires that erupt across at southwest France um and you know he said it’s just it’s just not viable. And I think there’s this real sense that it’s just not fair that as they are working very hard the workers, meanwhile you get the the wealthier the ultra wealthy who don’t appear to be paying enough in tax. And so that’s why this level of anger has erupted. And of course, as we know, it’s erupted into a lot of political instability, a revolving door at the Matignon and so many different prime ministers coming and going and different ministers coming and going. And now, of course, so we have back the government, the minority government under Le Cornoux, really needing to get this compromise through. But the pension reform has been put on hold, and it’s really slow going as to whether or not they will achieve this compromise.

00:05:00: Dominic Bowen: Yeah, there’s a lot of really interesting points you brought up there. And i’d love to unpack the wealth tax and and what that means. And, you know, it’s not just in France that this is becoming an important topic. We might come back to that. I’d love to hear maybe keeping it at the macro level for now. Why does this matter for all of Europe? Why does France’s economic, and we’ll talk about the politics in a second as well, but why does this matter for all of Europe? Because I don’t think this is just a French problem. This has potentially got some contagion risk and some implications for other European countries as well.

05:27: Susannah: Well, absolutely. I mean, France has got to respect its pledge to the European Union to curb its budget deficit to 3% of GDP by 2029. There are hopes that the compromise will allow it to do that. has implications, of course, in terms of the willingness of international investors to lend to France. Because of all this political instability, we have seen it yields on French government debt really creep up. And again, after a number of ratings agencies downgraded French debt. There wasn’t so much movement. There wasn’t a huge amount movement because already because of all this political instability, markets had kind of priced all of this in. But even so, it is closely watched because other countries are also, you know, they’re facing potential ah overruns with that with their budget spend, not quite in the same realm as France, but certainly though there can be contagion in that respect. There can be this concern over the stability even of the financial system. You know we’ve seen bank banking shares um take hits as all this political and instability has unfolded and this concern that ah lots of the in the financial sector, the big holders of of government debt. And if that’s devalued to them and have to kind of scramble to cover their losses elsewhere. So there’s all of that kind of implications for the financial sector as well. And this is why France is being watched very, very closely. Of course, we remember, you know, the greek debt crisis, for example. And because it’s the euro area and um countries don’t have that much room room for manoeuvre. Because, of course, it’s not Bank de France that sets the exchange rate, it sets the interest rate, rate I should say. It is the ECB. And there is only really this kind of wriggle room in terms of tax and spend that actually the French government has control over. And so there is, you know, lot of watchers just to see how this could play out in other countries.

07:14: Dominic Bowen

You mentioned the the credit agencies, and and I think Fitch downgraded France’s rating from AA negative to A+ in September 2025. So as you as you said, not a huge move, but it was still a downgrade. And this occurred amongst heightened political instability and and concerns about the government’s ability, as you said, to consolidate public finances. And the rating agencies have cited successive falls of government since 2024, which ultimately hinders this fiscal reform that’s needed in France, and increases doubts, obviously, about achieving these deficit reduction goals that’s required amongst the EU members. Now, rating agencies have forecast that public debt is going to rise in France, and as said, to 121% of GDP by 2027. And there’s also been notes of France’s political crisis that it’s unlikely to be resolved soon. So I’d love to explore that political element with you, Susanna. But first, can you explain why does this downgrade from the credit agencies matter? I guess for our average listener, they might go, uh, so what? They’ve been downgraded slightly. Does it actually matter?

08:15: Susannah: Well it does to some extent there has been relief though actually that mood is has maintained its credit rating on france but as you say yeah S&P and Fitch in recent weeks have downgraded France. I mean, Moody’s has kept its long-term sovereign rating at AA3, but I mean, it cited political instability and all these difficulties, as you’ve been highlighting, in trying to tame the budget deficit. Now, it does have an impact because actually, shortly after Fitch downgraded the outlook for France, it did see the yield. Essentially, France’s borrowing costs rise slightly. And so this does reflect this continuing uncertainty over the political leadership. And even though Moody’s did keep its rating on hold, it’s essentially put France on a report card. It could be that it may well in its next update downgrade France as well. So that essentially would be three strikes. Now, if there are five strikes and there are more ratings agencies that come through and downgrade France, that could have an implication in terms of really other institutional investors’ attitudes. At the moment, it’s not quite a disaster because the other agencies have kept it and it and the overall rating will be kept at kind of the last surviving better grade. But if you get all five downgrading France, that could have real implications. It could actually lead to a bit of a so-called haircut, ah which is and essentially… the method by which the European Central Bank adjusts the face value of a bond downwards to its value as a security for the Euro system borrowing lending. And that then could actually push off further institutional investors in buying French government debt. And that could then lead to France’s borrowing costs rise even further, which would make the and difficulties the but that the government have in balancing the books even more difficult. So this kind of like doom loop could emerge. So essentially it would reduce the market’s appetite for bonds, particularly longer maturities. It could make France… have to make more issuances in shorter maturities and that could increase its financing risk as well. But you know we’re not there yet, but France is on this report card and so this is the potential knock-on impact that could happen if there’s further downgrades.

10:20: Dominic Bowen: And you mentioned the political challenges and and the political situation in France remains highly unstable. It’s very fragmented and it’s potentially one of the most significant crisis in France since actually the founding of the Republic. And I think the root cause can come back to that hung parliament following last summer’s snap elections, which really produced no clear majority bloc. And the three dominant political parties is the left-wing New Popular Front, the centrist coalition led by President Macron, and then you’ve also got the far-right national rally that’s been increasing in popularity. But none have been able to form a stable coalition, and thus we’ve had this legislative paralysis since then. ah We had the recent resignation of the prime minister after just 27 days in the role. So how does France find its way out of this political situation?

11:05: Susannah:  Yeah, there’s no easy fix, is there? I mean, France doesn’t really have a tradition of cross-party parliamentary compromise. If you sit around any dinner table in France, you can see how diverse and sometimes volatile views can be. I’ve sat around many in in the past with communist right-wingers, and it can be very volatile indeed.  And of course, in Parliament, you know, that makes it very difficult. I mean, if France were more like Germany, perhaps, you know, they could be locked away and come out with a compromise much more easily. But this is kind of new territory. And just as you say, you know, you’ve got much more of a fracturing of the French political landscape. In fact, it’s not unusual. In many ways, you’re seeing a similar state of play unfold in the United Kingdom with reform and the Greens really rising in popularity. Not so much a two-party system anymore. So the Conservatives here in the UK really have dropped back Labour in second place reform, more right wing party ah rising rapidly. And it’s playing out like this as in many ways in France as well. There does certainly seem to be ever since the pandemic and you really, this kind of growing force ever since the great financial crisis of many people just really fed up with the establishment, and they’re showing their votes in these ways. And that is leading to this really fracturing of the political landscape. So I think really what’s ahead is going to be very difficult negotiations. And it’s not a wonder that it’s taking a long time. It looks likely that The kind of budget deadlines are going to be missed. Perhaps there’ll be even an executive order put in place to try and pass the budget, which certainly would not go down very well. I don’t think with the ordinary French people likely to see many more taking to the streets again if that were the case. Perhaps there’ll be some other kind of fixes to try and limp this over the line and some kind of extensions to these negotiations. But it’s going to be going through the current budget, essentially line by line and trying find some areas of compromise. But it certainly doesn’t look like we’ll get these kind of flagship reforms front and centre anytime soon.

13:06: Dominic Bowen: So given these deep divides and the failure to pass the the budget thus far, you know, what’s the most plausible scenario for resolving the the the current political deadlock? Do you think more snap elections are likely or do you think we’ll be able to come up with a coalition arrangement that that might emerge?

13:21: Susannah: I think it’s going to be limping along. I think there will be real attempts to try and get through some type types of compromise. I don’t think Macron will be wanting to go for another snap election, seen as a highly ah risky move, particularly given the protests and demonstrations that there have been. Certainly wouldn’t be guaranteed to flip onto his side. And if you look at some of the results of other elections around the world, there really have been big upsets. So I think it looks like perhaps there’ll be many more compromises. I mean, we aren’t going to, I don’t think, see this tax on the ultra-rich. That’s already been rejected. But there have been votes to increase taxes on multinationals, American big tech. There have been you know some tinkering around with the real estate wealth tax as well.  But it’s really got to be this this this compromise. It’s going to be very difficult. So I think the government is just kind of going to be limping forward.

14:14: Dominic Bowen: Well, that’s really interesting that you mentioned the wealth tax. But first, I’ll just remind our listeners that you can now watch the International Risk Podcast on YouTube. So if you prefer to watch your podcasts, please search for the International Risk Podcast on YouTube today. And please remember to subscribe to our channel on YouTube. That’s really important for our success. But Susannah, you mentioned the wealth tax and that’s particularly interesting. We’ve heard a lot of campaigning from Zoran Mamdani, the Democrat candidate for New York City Mayor. And he’s supporting an increase on taxes for the wealthy to fund much more expansive social programs. And he’s promoted crazy… a tax bracket for New York residents with income over $1 million, dollars taxed at an additional 5.9% on top of existing tax rates. And this is called the millionaire tax. But it’s aiming to fund, according to Mamdani, to fund free public transportation, universal childcare, city-operated grocery stores, rent freezers, minimum hourly wage of $30. And he’s also advocating for an increase in the highest corporate tax rate to increase it from 7% to about $11.5%. Now, he’s expressed views that billionaires shouldn’t exist at such time when there’s such extreme inequalities between the wealth and the poor. But he has said quite clearly that this isn’t a campaign to eliminate billionaires. It’s just an attempt to make things a little bit more equal. But at the same time, in the UK, the UK Green Party has proposed wealth taxes similar in nature to those proposed by Zoran Mamdani. And I think their tax is a proposal to increase tax by 1% on assets over 10 million and 2% on assets over a billion. And again, this is aimed to primarily address the deep inequalities and rising um public revenue. to fund things like universal childcare, special needs education, rural bus services, investments in the green economy. Are you seeing a similarity between what’s being proposed by the Greens in the UK, what’s being proposed by Mamdani in New York City and what’s being discussed in France?

16:06: Susannah: Yeah, absolutely. I mean, calls for taxes on the super wealthy really do seem as though they are now a global political battleground. And New York, yeah, the latest to be caught in the crossfires over on Mamdani, was swept into power on this affordability agenda and this pledge to curtail rent hikes, improve childcare and transport across the city. If you’ve been to New York, a couple of decades ago, the rents were eye-watering. Now they’ve gone up even further. It is not a surprise there are so many ordinary New Yorkers supporting him. I mean, his win in many ways is also a show of opposition against the Trump administration. But it does tap into the zeitgeist. I mean, across many parts of the world, there is this rising tide of calls for the ultra-wealthy to pay more. And understandably, there is a concern that New York’s competitiveness will be threatened with firms already showing willingness to flee to other tax friendly states like Texas, because remember, it’s not just on the ultra wealthy wants to increase corporation tax as well. Now, this plan for this minimum 2% tax on wealth over 100 million euros has been pushed in France by the left-wing group of lawmakers. And this has all come from economist Zucman. He was the French economist who devised it. Actually, he came up with a report had been commissioned by the Brazilian G20 presidency. So it’s not just come out of thin air. It’s the G20 group of nations, the presidency, actually suggested and commissioned this report. Now, Zuckman claims that bringing in such a tax on the very highest earners in society is a matter of fiscal justice. And it’s interesting that it has been rejected by the French parliament, but I mean, it’s not been by huge margin. So I really don’t think this issue is likely to go away. And yes, I think, you know, the Zuckman tax really is behind the proposal, which has led to this surge of popularity for the UK Green Party, Zach Polanski, its leader, has gone way further and suggested that it should be an annual tax of 1% on assets above £10 million pounds. I mean, for the UK, a country that’s already seen capital flights, such a tax, I think, would add more economic chaos. And we already heard from the Chancellor, Rachel Reeves, yesterday indicating… We’re giving a strong hint that in the budget, taxes will rise, but it’s going to be broad-based to try and balance the books and keep bond markets on side. So very unlikely that such a tax is going to be pushed ah by the Treasury, but it’s not going to be going away. And then when you look at actually what happened with BEPS, the OECD tax on corporates, a global minimum tax for multinationals. You know, if there could be some kind of international approach, which is coordinated, it could work, but certainly not by countries going it alone.

18:43: Dominic Bowen: Yeah It’s quite interesting you talked about flight risk. So from a market perspective, do you think that such a measure would risk accelerating capital flight and undermine investment, whether it’s in France, New York or the UK, or?.

18:55: Susannah: Well, of course, that that is the absolute fear. And that is what you saw before we had this global minimum tax for multinationals that is coming into force, so BEPS 2.0. Look, back in 2013, when the base erosion and profit shifting project was launched by the OECD and G20 countries, there was you know, really big opposition around the world. But now 140 jurisdictions have committed to enforcing the rules and profit shifting has already declined significantly. So increasing tax takes for countries. So, you know, there’s an argument to say, if you did bring in some form of tax on the ultra-rich, if it was coordinated and all countries across the world would agree to bringing, there then wouldn’t be the risk of capital flight. But of course, if individual countries go it alone, there is that real risk and then that would compound the problems for the governments and it would actually have the opposite effect. So this is the real issue facing countries at the moment. Really, many politicians would say, yeah, that probably would be the ideal, but we can’t just do that because if we do that, it’s going to make our situation worse. And with the United States currently skirting the rules-based order, obstinately ripping up trade partnerships, the prospect, I think, of any kind of global deal to tax the world’s biggest billionaires, mainly based in the United States, of course, is a speck on a very far off horizon.

20:12: Dominic Bowen: No, it’s very interesting because Sweden obviously had similar taxes in the 50s, 60s, 70s, and it resulted in some of what we loosely call Sweden’s largest companies actually being based in Switzerland. Now, Sweden reversed these taxes. But of course, you know once companies are set up in a foreign jurisdiction, it’s very hard to to pull them back home. And I think this this global push for wealth taxes, you know, it it is stemming from what is arguably quite a justifiable basis, this rising level of of inequality and this this outsized concentration of of wealth amongst billionaires.

20:40: Susannah: Yeah, and I think we’ve got to have this kind of um clarification on wealth taxes. More people, i think, understand that ultra-wealth taxes are very different to wealth taxes. Wealth taxes can actually hit swathes of middle, upper middle classes and really exacerbate the problem because they are responsible, something like 1% for, in some countries, around a third of the income tax take. And so certainly you wouldn’t want to encourage much wider capital flight. But there is this disproportion among the, you know, 0.0002 percent of the wealthiest in society. They’re not paying as a proportion. What even the 1 percent in general are paying as portion of their income because they’re using holding companies, for example, because they’re ultra wealthy and they’re able to use those kind of tax incentives to do that. The problem is what you certainly don’t want to quash is innovation and entrepreneurialism. And in fact, tax breaks to encourage um entrepreneurs, scale-ups and startups are absolutely crucial to encourage growth. And so it’s really trying to get that communication message across.

21:43: Dominic Bowen: Yeah, no, I think that’s a really important distinction. So thanks for making that. Because when we are talking about ah the the ultra wealthy, you know, we’re talking about the wealthiest 1% maintaining about 40% of global wealth. And I read a recent report from a financial analytical firm, and they identified that 25% of the wealth in the S&P is actually owned by 0.1%, which the last time we saw such a distribution of wealth was just before the Great Depression in the 20s and 30s.

22:06: Susannah: Yeah, and let’s remember as well, Zuckman, you know, he claims that this tax should be brought in on the top 0.0002% of earners in society. So, you know, it’s not it’s not a broad brush. It’s not in the top 1%. It is that tiny portion right at the top. But of course, it will still be damaging if one country was to go it alone, because simply those billionaires would relocate.

22:29: Dominic Bowen: And noting what you said about the the current rule-based order in America’s perhaps disregard for that you know or putting America first right now, do you think we’re actually able to, can the EU do it alone or is this something that’s likely to remain stagnant for quite some time?

22:40: Susannah: I think it’s going to be remaining, you know, for a long time because the EU would be crazy to do it alone, in my view, because already they’re facing more onerous tariffs. Trading partnerships are being redrawn. I think the dust has to settle, if it can, on this new trading order before we can really consider trying to implement even further some kind of global tax on the ultra-rich economy.

23:06: Dominic Bowen: And you mentioned the the US, and I think in comparison, the US economy remains much larger, it remains much more dynamic, and it’s got a higher GDP than and certainly all European states individually and even the EU at large. Now, I think part of this is the US benefits from you know great technological innovation, better business flexibility, less regulation, perhaps a more diverse and resilient economy. It does face challenges like income inequality as well. It does face significant infrastructure needs. And of course, the US has dramatic political polarisation. ah But at the same time, the US continues to outgrow most European countries. 

23:40: Susannah: It does, but it’s slowing down, of course. And I don’t think we’ve seen the extent of the slowdown, so far, because many of America’s largest companies haven’t been passing on the full cost of the tariffs to consumers. They’re starting to. That’s why partly you’ve seen CPI, the latest headline reading, going in the opposite direction to what the Fed would like to see. We’ve got growth slowing down. We’ve got the labour market weakening. I think this is still yet to unravel the full extent because we as we know, you know, different tariffs are being set almost um every week or even every day and and new tariffs are threatened on different countries, which will then have further implications down the road. So I do think that the concept of US exceptionalism has been dented and continues to be dented. Look at the performance of the dollar so far this year. And, you know, gold has had this record ramp up as the safe-haven view of the dollar has been eroded. We’ve seen, you know, slight change in this, a little change in this recently, but overall that kind of pattern is still continuing. And again, we’ve now got all this concern about overvaluations on Wall Street. The latest, of course, is Michael Burry, who rose to fame during the great financial crisis for spotting vulnerabilities in mortgage liabilities. And he shorted the country’s housing market. He’s now shorting the likes of Palantir and NVIDIA. So he’s joined this chorus of warning voices, you know, Goldman Sachs, David Solomons, JP Morgan’s Jamie Dimon, and even Warren Buffett’s stockpiling cash, Wilkeshire Hathaway anyway. So there are these concerns, you know, emerging about these AI valuations, which I think is going to add to potential concerns about US exceptionalism. So let’s watch this space, I would say!

25:16: Dominic Bowen: And I’ll push you a little bit on that one because, I mean, in April, certainly we saw the US market in particular take a very big hit when Trump first announced all the the tariffs. But it very quickly rebounded. And I think there was that immediate flight to Europe and emerging markets. But then, you know, by May and June, you know, it was difficult to stay in those markets. People were flooding back to the US because…

25:36: Susannah: I don’t think they’ve been flooding back to the US. I think what you’re seeing is this rotation ongoing. I think a lot of what you saw in April, that was retail investors piling back in takes because of the so-called taco trade. And that was partly why you saw valuations bounce back. As far as institutional investors are concerned, they’ve not deserted the US, but they are recalibrating portfolios. And I do still think that the some of the biggest opportunities that we may see going forward in an era of low growth and uncertainty over the outlook in the United States are going to be other geographical sectors. And I certainly think as you look at the flow of funds, yeah, there has been some flows back, but not huge flows. So I think that a lot of what you’re saying over enthusiasm from return investors.

26:20: Dominic Bowen: Interesting. And your point on gold is is well said. We’ve had two interviews recently on investors that specialise in gold. So um please do listen out for those.

26:27: Susannah: We’ve  talked a lot about the deficits being built up in Europe, but let’s remember the US government has been in shutdown, the longest shutdown. And we still have this, you know, debt pile rising, an eye-watering debt pile, with a lack of agreement between Democrats and Republicans. Perhaps they will come to some kind of agreement in the days to come, but it’s still going to be a very fractious time ahead. And so i think this is also dented investor sentiment.

26:53: Dominic Bowen: Oh, unquestionably. I mean, the US debt repayments are just phenomenally high. And of course, as you said, the US shutdown is just incredibly painful. I mean, with a historic, I think it’s about $38 trillion ah dollar debt. I mean, it’s just a phenomenal size. And I think as of recording today, we’re at about day 36 of the government shutdown, which is the longest in history. I mean the The US is certainly in ah in ah in a very challenging place. But meanwhile, at the same time, ah people like Bannon and and others are are advocating for Trump serving a third term. So I think there’s ah certainly it ah ah the midterm elections in the US will be very, very interesting to watch.

27:22: Susannah: They were, particularly given these most recent mayoral elections that we’ve seen unfold. And the Democrats have certainly made a very good showing. And partly, you know, on this kind of, it’s interesting going to see going forward in New York, it’s been this real populist agenda, but whether or not the Democrats will go for the middle ground or whether it will be fought to different battles in different areas, depending on the groundswell of opinion. So, yeah, I think the democratic strategy going forward is going to be super interesting to watch.

27:50: Dominic Bowen: Definitely. And when you look around the world, Susanna, what are the international risks that concern you the most?

27:55: Susannah: I still think that um we don’t quite know what will unfold in terms of what will happen with China and Taiwan. Interesting to see this latest agreement between the US s and China seen again as a taco tray, Trump always chickens out. I mean, China’s technology pro technological prowess really is something to behold. And it certainly turned the screws on the United States with the ban on rare earth minerals, which of course is so absolutely crucial for the US tech industry. So China getting the upper hand there, be interesting to see what kind of concessions might’ve been made behind closed doors, if any, in terms of um what could happen next if the ah China was to become, was to move to a more saber rattling mood against Taiwan. The other area that I think, of course, it is still to be watched is the Ukraine conflict doesn’t seem to have any sign of resolution. NATO has shown resolution and we’ve had all these pledges in terms of countries increasing their defence spending, spending on infrastructure, really upping um their contributions to the NATO budget. But that is going to take considerable time before NATO really has been beefed up to that extent in Europe. And then, of course, I think another area to watch is the Arctic, because the Arctic ice melts. New trading routes are opening up. Remember, as well, as vast minerals under the Arctic that there could be a battleground ahead. And I think that could be another potential geographical area to watch in the future, given the growing importance for international trade as the Arctic ice melts and the potential for… potential, I say, for some kind of conflict to emerge.

29:29: Dominic Bowen: Oh, definitely. Actually, we were having a conversation just yesterday as part of our regularly planning meeting at the International Risk Podcast, and we actually discussed the Arctic, and we all agreed that we need to do an episode in the next couple of months exploring ah both trade but also military developments in that region.

29:43: Susannah: It’s absolutely fascinating. I’ve chaired the Arctic Frontiers Conference for three years in a row in Tromsø, which is in northern Norway. Spectacular city, the land of the midnight sun, and really some of the debates there in terms of as you say, the crucial building up of infrastructure to protect the region, but at the same time, this need to keep pristine areas. So there’s this real, real concern of indigenous peoples about um too much construction, yet this real understanding that there needs to be construction, there needs to be higher populations in the north to ensure that the area is well defended. And also at the same time, you know, the Arctic ah the arctic is experiencing climate change at a faster rate than many other, almost all regions around the world. Yet under the ice sheets, there’s all these sense minerals that could be so crucial. And so there again, this is kind of this battleground in terms of whether the Arctic should be developed to try and stop climate change, which is causing it so much destruction. So, all of these issues, I think, are our key ones to watch.

30:43: Dominic Bowen: Yeah, incredibly interesting and thanks for raising those and and thanks very much for coming on the international risk podcast today Susannah!

30:48: Susannah: Thank you. It’s been really great to talk. There’s always so much to say, isn’t there, in so many different parts of the world? It’s been lovely to to be on the podcast.

30:56: Dominic Bowen

Thanks, Susanna. Well, that was a really great conversation with Susanna Streeter. Susanna is an award-winning financial expert, journalist and commentator. And I really appreciated hearing her thoughts on France’s political and economic situation, as well as a variety of other geopolitical and international risks. Please remember to subscribe to our emailing list to get our bi-weekly newsletter in your inbox every week. Today’s podcast was produced and coordinated by Melanie Meimoun, and our video and social media content was produced by Stephen Penny.

Thanks very much for listening. I’m Dominic Bowen. We’ll speak again in the next couple of days.