| Hello from Davos, where a panoply of leaders and executives have been attending the World Economic Forum’s annual meetings. I’m Craig Stirling, a senior economics editor, and today we’re looking at the geopolitical shifts being telegraphed in Davos. Send us feedback and tips to ecodaily@bloomberg.net or get in touch on X via @economics. And if you’re in Davos, don’t forget to drop by Bloomberg House. Register here.
The whirlwind of news sparked by Donald Trump this week has kept Davos buzzing with speculation about trade and deregulation. His threats to Russian President Vladimir Putin of tariffs, taxes and sanctions are set to spur yet more chatter. “We can do it the easy way, or the hard way,” the US president said on Truth Social today. “The easy way is always better.” With the world eagerly awaiting a peace deal in Ukraine that he once said was achievable in 24 hours, that country has been doing its best to woo the Davos crowd. Its party venue there, Ukraine House, bankrolled by billionaire Victor Pinchuk, was the place to watch Trump’s inauguration on Monday while sipping vodka.  Ukraine House in Davos. Photographer: Hollie Adams/Bloomberg Ukrainian President Volodymyr Zelenskiy appealed to him to ensure American boots on the ground will help police the implementation of any eventual accord. “It can’t be without the United States,” he told Bloomberg Television in Davos. “Even if some European friends think it can be, no it can’t be.” Zelenskiy stressed Chinese President Xi Jinping’s influence as critical to persuade Putin. Finnish head of state Alexander Stubb also favors that tactic. “If there’s a connection between President Xi and President Trump on ‘yes we need to muster a peace deal,’ I think it’s pretty much the job of President Xi to convince Putin,’” he said in an interview. “Then it’s the job of Donald Trump to find a deal which is fair.” In the meantime, pressure on Putin will continue on both sides of the Atlantic. European Union economy chief Valdis Dombroviskis, while insisting that “sanctions are working,” told an audience that the region is trying to target Russia’s so-called shadow fleet of tankers. Then there’s help for Ukraine itself. German Finance Minister Joerg Kukies, claiming that “Germany is Ukraine’s largest supporter in Europe,” said his government has proposed more aid, budget permitting. “We absolutely urgently have to support Ukraine,” he told Bloomberg Television. But what matters most of all, according to Stubb, is the US president’s involvement. “Trump has a huge role to play here,” he said. “In many ways, a Ukrainian victory is an American and a Trumpian victory.” - Don’t miss the latest episode of the Trumponomics podcast from Davos, where Bloomberg’s Stephanie Flanders and colleagues unpack the new president’s transactionalism across the global economy.
 | | | - Argentine President Javier Milei said he would leave Mercosur if necessary to cement a free trade agreement with the US.
- Investors seeking a contrarian bet could sell US tech stocks and boost holdings in China, the head of Norway’s $1.8 trillion wealth fund said.
- UK Chancellor Rachel Reeves said “the answer can’t always be no” when it comes to approving major infrastructure works and planning decisions.
- Steelmaking tycoon Lakshmi Mittal met South African President Cyril Ramaphosa in Davos as the country seeks to head off the planned closure of steel mills.
- A top JPMorgan Chase banker has a message for rivals across Europe: they’ll have to get bigger if they want to keep him on his toes.
- Trump may spur a wave of dealmaking, the Barclays CEO said, with the Qatar Investment Authority seeing a boom for US tech transactions.
- Spanish premier Pedro Sanchez hopes Telefonica’s new management will shift direction and help to develop his country’s chip industry.
How will the next financial crisis occur? A panel with Francine Lacqua today asked that perennial Davos question. For UBS CEO Sergio Ermotti, the next storm could be a “traditional” one. “Maybe we shouldn’t be too innovative in thinking about something completely new, and be a bit more careful about the level of debt in the systems today,” he said.  Ermotti during a panel session at the World Economic Forum in Davos. Photographer: Stefan Wermuth/Bloomberg Lim Chow-Kiat, who runs Singapore’s GIC wealth fund, agreed but also wondered if inflation could be the trigger. “It hits every asset and every liability” he said. “Given the good performance actually of most financial assets in the last 15 years, that adjustment could be very severe.” Klaas Knot, the Dutch central bank governor who chairs the Financial Stability Board, was less keen to speculate. But he vows to be ready, and will prioritize getting to know his new US counterparts. “If a crisis hits, at least we all have each other’s phone numbers,” he said. Tune in to Bloomberg Television for hard-hitting interviews with NATO chief Mark Rutte, Morgan Stanley CEO Ted Pick, Goldman Sachs Vice Chairman Richard Gnodde, Anthropic CEO Dario Amodei, TCW CEO Katie Koch, among many others. In the conference center itself, all eyes will be fixed on Trump, who addresses the forum at 5 p.m. Davos time. We’ll also keep an eye on a multitude of panels as participants ponder Ukraine, tariffs, climate and the middle class, and how to deal with central-bank divergence. Elsewhere in the World Economy | - Bank of Japan Governor Kazuo Ueda is on track to raise rates to the highest level since 2008 on Friday.
- Norges Bank will restate plans for its first post-pandemic cut in borrowing costs in March, with the outlook for further steps clouded.
- Plans by the European Central Bank to push ahead with rate cuts are withstanding the early jolts in US economic policy driven by Trump’s return.
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