Today's number: 338. That's how many dollars it costs to apply to become bankrupt in the United States. That makes America one of the few places in the world where you have to pay to be broke.
Welcome to Profy Markets. I'm Ed Elson. It is January 28th. Let's check in on yesterday's market vitals. The S&P rose to a record high on optimism for big tech earnings. That gain came in spite of US consumer confidence data, which actually fell to its lowest level since 2014. Meanwhile, UnitedHealth dragged the Dow into the red. More on that in a moment. The yield on 10-year Treasuries rose ahead of the Fed's decision out this afternoon, and the dollar continued its slide to a 4-year low as President Trump dismissed concerns about the currency's decline. And he said, quote, 'I think it's great.' He also said, quote, 'I could have it go up or go down like a yo-yo.'
Okay, what else is happening? The EU and India have finalized a historic free trade agreement. The deal, which comes after two decades of talks, will phase out tariffs on the vast majority of goods. That move is expected to double European exports to India within the next 6 years. The timing of the deal is also telling. It landed just after President Trump's threats over Greenland strained relations with Europe. Meanwhile, India faces US tariffs as high as 50% on key goods, which raises an important question: Are America's allies hedging their bets? Here to help us answer that, we are speaking with Liz Hoffman, business and finance editor at Semafor. Liz, welcome back to Profy Markets.
Hey, Ed. So, we want to get your reactions to this new trade deal confirmed between Europe and India. Uh, it'll phase out most of the tariffs. It's going to double the value of European exports to India within the next 6 years. Uh, people are calling it historic, the mother of all deals. Any initial reactions?
Yeah, I mean, unless you live in the EU or India, which is in fact a lot of people, I think the numbers will either bear out or not. But to me, sort of directionally, what this signals is that a lot of countries around the world, particularly these middle powers that are really big economies but not sort of hegemon-adjacent, are starting to realize that they can go around Washington rather than simply being forced to kind of knuckle under. And so you're starting to see these new trade patterns emerge, new trade alliances emerge. This deal has been years in the making. And the thing that got it over the finish line was Donald Trump picking fights all over the world.
My read on the situation is it's clear that America is, I guess, sticking up the finger to Europe and various other allies in various ways. We saw what happened in Davos, and now just a few days later there's this announcement of this deal. It looks like this is very much a reaction to what happened in Davos. You were at Davos. Is that the correct conclusion?
Yeah, look, the big story at Davos was Donald Trump, but the event that really stuck with me was a speech that the prime minister of Canada, Mark Carney, gave. I mean, really just like immediately a historic document, kind of a speech for the ages is what Larry Fink, the CEO of BlackRock, called it when I talked to him at the end of the week. And really, this was a call to arms to these middle powers to say, you know, there's been this rupture, he called it, in the world order, and we can either forge our own way or really recede under that wave. And you know, Carney had, I think, either just been or was on his — I think he had just been in China where he had signed a huge trade deal between Canada and China that, taking a step back, is actually a remarkable alliance. You know, it wasn't that long ago, if you remember, there were these huge geopolitical tensions between Canada and China. Canada had arrested a Chinese — a Huawei executive. I mean, there were — this was really fraught relations between the two countries. And now you have this big trade deal that, among other things, will bring Chinese EVs — these really fantastically futuristic, the tech is great, they are cheap — electric vehicles to Canada, right on America's doorstep. And it all felt like a bit of a middle finger to Donald Trump. Also, he gave like the first couple of minutes of the speech in French, which really felt like standing up for, you know, a kind of multilateralism and globalism that Donald Trump has really tried to dismantle. So, you know, that was kind of a call to arms, and then right on the back end of it we see this huge trade deal between India and the EU, and these are goods that, you know, in a different tariff regime would be headed here, and you know, will not be because of the tariffs that the White House has put on, particularly India.
I recently saw Mark Carney speak about that speech, which, as you say, I mean, everyone considered it to be groundbreaking. I've seen Canadians saying it's the best speech that a prime minister of Canada has ever given. Apparently he told the president, 'I meant what I said.' That is — those were his words. It seems like he is doubling down on this. It appears that perhaps Europe is also doubling down on this position: 'We're going to find allies elsewhere.' Do you expect that we will see more of these trade deals? I mean, it seemed like maybe the ball was starting to get rolling. I was wondering whether it would stop in 2026, but it appears to be accelerating. Would you agree with that?
I would. The EU has, you know, opened and extended trade talks with some of their other partners. The thing that really crystallized for Europe in particular, but for a lot of other countries, when Donald Trump started this trade war back in the spring of 2025, was they said, 'Oh, we are really reliant on the US, right?' I mean, there was — and that's what gave the White House so much of its power on the way in. And you know, they had some early success striking some of these trade deals. But the alternative, if you're Europe or India or Japan or Canada, is to say, 'Oh, we are too reliant on the US,' and to go find partners elsewhere. And you know, the world is a big place and it is fragmenting. One word that was — Davos always coins these slightly ridiculous phrases — and one that I heard a lot last week was 'minilateralism,' kind of as a replacement for multilateralism, and that these big global trade webs that largely flowed through the United States, kind of as a global protector and hegemon and kind of, you know, good corporate citizen, are being replaced by these more localized, more bilateral agreements and arrangements that increasingly are going to flow outside of Washington and around Washington. Probably at least, you know, to some degree in the near term, to the detriment of American consumers.
Okay, Liz Hoffman, business and finance editor at Semafor. Liz, appreciate your time.
Anytime, Ed. Always a pleasure.
