Good morning and welcome to White House Watch. President Donald Trump has said the alliance between the US and Japan is at its “strongest level” during a meeting with the country’s new Prime Minister Sanae Takaichi.
The leaders signed two agreements, one on critical minerals and rare earths, and another that called on each government to “take further steps for a new golden age” for the US-Japan security alliance. Here’s the latest on Trump’s second leg of his weeklong trip to Asia. Also in today’s newsletter:
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Bessent takes on his critics
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Are Gen Z voters going off Trump?
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Silicon Valley’s return to the 1990s
Scott Bessent, the 63-year-old hedge fund manager from South Carolina who is now the US Treasury secretary, sought to burnish his anti-establishment street credentials in an exclusive interview with the FT’s James Politi.
“Unlike most of my predecessors I have a very healthy scepticism of elite institutions and elite opinion, whereas I think they didn’t,” Bessent told the FT, speaking from his office sofa. “But I have a healthy regard for the market.”
Despite this, Bessent has backed Trump’s sweeping tariff agenda, championing the US president’s protectionist instincts and supporting his efforts to overhaul the Federal Reserve.
Some of his critics argue that the US Treasury secretary has shaken the department’s free-market orthodoxies on trade, government intervention and central bank autonomy. But Bessent is keen to distance himself from other populist governments around the world.
“What gets the people in trouble is they come in, they have these ideas, but they don’t respect the market . . . you’ve got to respect the market”.
Bessent has kept markets in check recently, although Trump’s initial unveiling of steep “reciprocal tariffs” in April triggered a stock market rout. The US president was forced to pause the tariffs and start making deals to lower some of them.
Bessent told the FT that the turmoil had always been part of the plan. “[Trump] has a higher risk tolerance than I do,” he said.
Over on Wall Street, investors and executives have begun to rely on their man in Washington to keep the markets calm.
“When it counts, he’s a fighter in our corner,” said one Wall Street lobbyist. “It’s almost like this ‘Bessent put’ — he knows not to go too far where the markets would be disrupted . . . CEOs are pretty fearful of the administration, but Bessent is our id”.
The latest headlines
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The Federal Reserve is expected to end a three-year phase of quantitative tightening this week, easing pressures on banks amid concerns that funding is getting too tight in money markets.
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Argentina’s currency and government bonds surged on Monday after a landslide midterm election victory for Javier Milei’s party in the country.
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The US government’s debt burden is on track to exceed levels in both Italy and Greece for the first time this century, according to IMF forecasts.
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US companies struck more than $80bn worth of deals over Sunday and Monday in a consolidation spree across some of the country’s biggest industries.
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Did Ronald Reagan “love tariffs” as Trump claims? America’s 40th and 47th presidents both employed protectionist measures, but in vastly different ways.
What we’re hearing
Gen Z voters in the critical swing state of Pennsylvania are more likely than Millennials to be registered Republican — and Ian Hodgson travelled to a Northampton County to understand how their politics have shifted under Trump.
Anxious and disillusioned young voters told the FT they were navigating increasingly bitter political divisions that were ending friendships, all while worrying about their economic future.
Brady Carvajal, a local high school senior in Bethlehem, Pennsylvania, was introduced by his older brother to the late rightwing commentator Charlie Kirk’s podcast in his early teens.
“The tension definitely builds” when politics come up at school, the 17-year-old said. “The lines have become easier to draw as people have become less moderate.”
Young people across the country were preoccupied with rising prices as they headed to the polls in November 2024, and almost a year later, they are still plagued with economic insecurity.
“We’re getting priced out with housing, with food, with inflation in general. The difference between the winners and losers has become so blatantly higher than in the past,” said 24-year-old Peter Capote.
His sentiments were echoed by Carvajal: “I’m not sure I’m going to survive with this economy . . . I’ve always thought about, in the future, trying to own a house, how I’m going to be able to start a family . . . I don’t really know how I’m gonna be able to afford things like that in life.”
Pennsylvania was one of the few swing states where the turnout of voters under the age of 25 increased from 2020 to 2024.
But unease over some of the US president’s policies has prompted a drop in support for him across the country among Trump voters who are Gen Z, according to Pew Research.
The pollsters found that Trump’s approval rating among those under 35 who voted for him had fallen by 25 percentage points since February — the largest decline in any age group.
Over the next four years, the FT will be reporting from Bethlehem, Pennsylvania — a post-industrial city in one of the country’s electoral battlegrounds — to understand Trump’s economy and the hopes of those who backed him in 2024, and those who didn’t. Read more here.
Viewpoints
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