Politics

Just two months into Donald Trump’s second term, Wall Street is unnerved. Julia Coronado, the president and co-founder of the economic consulting firm MacroPolicy Perspectives, said that’s because investors and executives had convinced themselves that Trump wouldn’t do anything significant to disrupt the market’s upward trajectory.

“We had a pretty great setup for Trump,” Coronado said in an interview with POLITICO Magazine, paraphrasing the thinking on the Street. “Why would he mess with that?”

Coronado, a former Federal Reserve economist who’s held top roles at BNP Paribas and the hedge fund Graham Capital Management, is a widely sought after economic consultant whose clients include asset managers, hedge funds and banks. I spoke with Coronado as she drove to the University of Texas at Austin, where she’s a clinical associate professor of finance at the McCombs School of Business.

Wall Street craves predictability, but Trump’s early priorities — including off-and-on tariffs, government cutbacks and immigration crackdowns — signal that this time around, the president has a much stronger appetite for disruption. He has refused to rule out a possible recession even after markets convulsed following a series of major tariff announcements.