Geopolitical Noise vs. Market Signals: Fed Indictment Drama, Venezuela Conflict, and the Greenland Tariff Gambit

Introduction

Three major geopolitical events have dominated the headlines recently: a DOJ probe targeting Federal Reserve Chair Jerome Powell, escalating U.S. pressure on Venezuela, and President Trump's surprise tariff offensive tied to purchasing Greenland. On the surface, these seem like isolated political dramas. But look deeper and you'll find a common thread. These headline-grabbing sagas are mostly noise masking critical monetary and systemic signals.

As a team of macroeconomic and geopolitical analysts at PULP Research, we focus on deciphering the true market implications behind the theater. We help institutional investors and high-net-worth individuals navigate the opportunities.

In this report, we break down each scenario and examine how political noise often disguises monetary signal. We explore why the DOJ vs. Fed clash is more spectacle than substance for markets. We look at how the Venezuela conflict is fundamentally about defending the dollar-based system. And we analyze how Trump's tariff playbook creates volatility that savvy investors can capitalize on.

These events align with a larger transition toward a new financial order. This is one where disruptive, ISO-compliant digital assets and other resilient investments stand to gain.

The bottom line: by cutting through the narratives and focusing on liquidity, structural shifts, and historical patterns, investors can position themselves not only to protect wealth but to profit from the coming changes. The louder the political narrative, the more it often pays to focus on the underlying monetary reality.

The DOJ vs. The Fed: Political Theater vs. Monetary Reality

What Happened

In an unprecedented confrontation, the U.S. Justice Department served grand jury subpoenas on the Federal Reserve in early January 2026. The subpoenas targeted Fed Chair Jerome Powell with a criminal inquiry. The official reason involves Powell's testimony about cost overruns on a Fed building renovation and allegations he defied President Trump's interest-rate demands.

Powell himself has publicly blasted the move as a "pretext." He suggests the real motive is to pressure the Fed into cutting rates faster, rather than any genuine concern about construction budgets. In essence, the Trump administration appears to be leveraging legal threats to influence monetary policy. This erodes the traditionally sacrosanct independence of the central bank.

This dramatic DOJ vs. Fed showdown has all the makings of a political crisis. Headlines blared about a "threat to Fed independence" and a new low in executive-central bank relations. Yet, for all the sound and fury, what does it actually mean for markets?

Our analysis: It's noise. It's a high-stakes political skirmish that doesn't alter the trajectory of monetary policy or the credit cycle in any meaningful way. In fact, the markets basically shrugged. Fed Funds futures and rate markets barely budged on the news. They continued to price in multiple 2026 rate cuts despite the legal drama. Any initial knee-jerk dip in the dollar or equity futures was modest and short-lived. Investors correctly sensed that courtrooms don't set interest rates. Economic conditions and liquidity do.

Why It's Mostly Noise

The Federal Reserve will not change course because of political posturing or prosecutorial theatrics. It will change course when the financial system forces its hand. History shows that when credit markets strain or liquidity dries up, the Fed responds with easing, regardless of what politicians are saying.

As Powell himself has held firm, raising rates through much of 2025, it wasn't presidential jawboning that eventually led the Fed to pivot. It was the data. By late 2025, inflation had eased dramatically and growth was softening. This effectively cornered the Fed into beginning a rate-cut cycle.

Indeed, the Fed delivered a string of quarter-point cuts in Q4 2025 as inflation fell below 2% and labor market cracks emerged. The irony is that even as Trump railed against Powell for not slashing rates fast enough, the macroeconomic cycle was already turning. The central bank started easing not to appease the president, but because it had to.

As one market commentator noted, by early 2026 "data now dictates policy direction." The Fed is being cornered by the economy, not by political theater. In other words, monetary policy is on autopilot toward easing when conditions warrant it, DOJ threats or not.

From an investor's standpoint, the Powell indictment saga vividly illustrates why we stress focusing on signals, not noise. The signal here is that we are late in the tightening cycle. Financial conditions have become restrictive enough that relief (rate cuts, liquidity injections) is on the horizon. The political fireworks are a sideshow. If anything, they confirm how fraught the endgame of this cycle is, with increasingly radical narratives emerging as the system reaches a breaking point.

But ultimately, none of the political posturing will prevent the eventual monetary pivot. As Powell himself has hinted, no central banker can hold a tough stance forever if markets seize up or deflationary forces take hold. When stress builds enough, the pivot comes. Ignore the lawsuit. Watch the liquidity.

Investment Takeaway

We view the DOJ-Fed tussle as political noise overlaying a mechanical system. The real driver for markets (and portfolios) will be the liquidity cycle, not who "wins" the legal battle. Savvy investors should therefore position ahead of the coming policy inflection point.

The closer we get to the cycle's end, the louder the political distractions become. But also the stronger the monetary signal grows. Now is the time to prepare for the Fed's easing phase: a weaker dollar, lower rates, and a revival of risk appetite.

Rather than overreacting to sensational headlines about Fed independence, you should be looking at credit spreads, dollar liquidity, and funding markets for the true guide to Fed policy. Those are already telegraphing easing. When the system needs liquidity, it will get it, regardless of any DOJ grandstanding.

As we often remind our clients, courtrooms don't set rates. Credit markets do. The prudent move is to ensure your portfolio is positioned for that inevitability. Consider adding duration on dips, increasing gold or anti-dollar assets, and selectively positioning in equities or digital assets that benefit from an abundant-liquidity environment.

The playbook is to stay ahead of the Fed's eventual capitulation, not to be distracted by the noise on TV. In short, keep your eyes on the dollar and liquidity gauges, not the cable news battles.

The Venezuela Conflict: It's About the System, Not the Headlines

While U.S. domestic politics grabbed attention, another drama unfolded in geopolitics: a sharp escalation of U.S. actions toward Venezuela. Officially, the rhetoric centered on drug trafficking and restoring democracy. The Trump administration painted Venezuela's leader Nicolás Maduro as a criminal regime that must be dealt with.

But as with many geopolitical conflicts, the public narrative is a carefully crafted facade. Strip away the morality play, and you find a far more consequential monetary motive. The defense of the U.S. dollar-centric financial system.

The Timing: A Telling Clue

In late 2025, something remarkable happened in global markets that went largely underreported. China issued a modest $4 billion of U.S. dollar-denominated bonds in Hong Kong. A routine transaction on the surface. But the outcome was eye-opening.

Demand for these bonds was off the charts (order books swelled to nearly $120 billion). Once trading began, these Chinese sovereign bonds yielded less than equivalent U.S. Treasuries. Global investors were effectively saying they'd rather lend to A+ rated China at lower interest than to AA-rated United States. This was highly unusual. It wasn't supposed to happen in a world where U.S. Treasuries are the "risk-free" benchmark. Such an anomaly hinted that something in the perception of risk and trust was shifting.

Not long after this quiet vote of confidence in China (and subtle vote of no-confidence in U.S. fiscal/debt trends), Washington's stance on Venezuela hardened dramatically. By early 2026, the U.S. had even seized Maduro himself. A move almost unthinkable a year prior. Washington began openly discussing ways to overhaul Venezuela's oil industry under U.S. auspices.

The coincidence was hard to ignore. A cynical but realistic interpretation is that these events are connected by an underlying thread. The U.S. dollar's hegemony was being questioned at the margins, and the U.S. responded where it could to shore up the system. As one veteran analyst put it, whenever confidence in the reserve currency starts to erode, geopolitical responses tend to follow. Not as random one-offs, but as part of a broader pattern of monetary enforcement.

Venezuela's Real Sin

It has little to do with socialism, drugs, or corruption (as abundant as those issues may be). Venezuela's unforgivable sin in the eyes of the U.S. establishment was stepping outside the dollar system in a meaningful way.

This country holds the largest proven oil reserves on Earth (about 300 billion barrels, or 17% of global reserves). Even Saudi Arabia's reserves are smaller. Under Maduro, Venezuela began pricing and selling its oil in currencies other than the U.S. dollar. This included euros, Chinese yuan, and even bartering through crypto or other means to evade U.S. sanctions.

Caracas had openly declared its intent to "free" itself from the petrodollar. It sought yuan and euro payments for oil as early as 2017. In recent years, an estimated 80% of Venezuela's oil exports were flowing to China. Often settled in yuan or via non-dollar channels. This directly undermined the dollar's dominance in a segment of global oil trade.

This is exactly the kind of move that history warns the U.S. will not tolerate. The petrodollar system, established in the 1970s, is the bedrock of American financial power. Under the 1974 Saudi-U.S. accord, OPEC oil began trading exclusively in USD. This created permanent global demand for dollars and U.S. Treasuries. This arrangement has allowed the U.S. to finance deficits and project power with relative impunity for decades. Oil flowing through the dollar is what kept America's "exorbitant privilege" intact.

Thus, when a major oil nation like Venezuela attempts to sell its oil in yuan (effectively bypassing the U.S. banking system and sanctions leverage), it isn't just making a commercial choice. It's challenging the architecture of the global monetary order. And, consistent with a pattern seen before, such challenges are met not with dialogue, but with force.

Historical Pattern of Monetary Enforcement

Venezuela is not the first to meet this fate. We've seen this movie before.

Iraq (Saddam Hussein)

In 2000, Iraq received UN approval to switch its Oil-for-Food oil sales from dollars to euros. Saddam started selling oil in euros. A bold thumb in the eye of the petrodollar. By 2003, the U.S. invaded Iraq under the pretext of "WMDs" and regime change. One of the first post-invasion actions was to revert Iraq's oil exports back to dollar pricing. The euro experiment ended abruptly.

In hindsight, many observed that while multiple motives drove the Iraq War, preserving dollar dominance in oil trade was a likely factor, even if not admitted openly. The pattern: leader threatens petrodollar, leader is removed, oil back to USD.

Libya (Muammar Gaddafi)

Gaddafi's Libya was not just sitting on Africa's largest oil reserves. Gaddafi was actively proposing a new gold-backed African dinar as a trading currency. He aimed to liberate African oil trade from dollar and French franc dependence. This posed a direct threat to Western central banks (and their fiat currencies) had it gained traction.

In 2011, under the banner of humanitarian intervention, NATO forces (primarily the U.S. and France) helped overthrow Gaddafi. Leaked emails and records later suggested that concerns about Gaddafi's gold currency ambitions did weigh on Western decision-makers. Again, the official narrative (protecting civilians) masked a strategic motive: neutralize a monetary threat to the dollar's sphere of influence.

Others

Iran has long been sanctioned in part for seeking euro and other currency oil trades. Russia (another major energy producer) has been systematically reducing dollar exposure and trading oil in rubles/yuan with partners. It has faced intensifying sanctions and isolation since 2014.

The common denominator is clear. When leaders or nations "defect" from the dollar-centric system, they quickly find themselves in the crosshairs. As a Reuters column plainly summarized, "Each time a nation threatens the petrodollar system, it is swiftly rebranded as a global danger." It's monetary enforcement dressed up as moral necessity.

Now, back to Venezuela in 2025-2026. By engaging in yuan oil sales and courting China and the BRICS bloc, Venezuela painted a target on its back. Washington's hawks see Venezuela's alignment with China/Russia and its petro-yuan trades as a direct assault on the post-1970s U.S. petro-dollar regime.

Thus, the sudden revival of interest in "liberating" Venezuela isn't about its political system. It's about keeping the world's largest oil reserves firmly in the dollar-based trading network. President Trump openly stated his intention to have U.S. energy companies revitalize Venezuela's oil industry. In other words, bring that oil back under Western control and dollar denomination.

If successful, this would both deny China a direct source of non-dollar oil and create a new stream of petrodollar flows as Venezuela's output ramps up under U.S. influence. As one expert succinctly put it, "The dollar is still the key currency in the oil market, and the U.S. is trying to preserve this."

Crucially, these extreme measures are a telltale sign of systemic fragility, not strength. A healthy reserve currency doesn't require military or legal coercion to maintain its role. The fact that Washington is resorting to such heavy-handed tactics (indicting central bankers at home, arresting foreign heads of state abroad) betrays a certain desperation to uphold an eroding order.

Analysts have noted that the petrodollar's power, while still substantial, is waning. Thanks to shifts like the shale boom, the U.S. itself is no longer a top oil importer. This reduces recycling of petrodollars. Major exporters are using more of their oil revenues at home or trading in other currencies. It's estimated that roughly 20% of global oil is now transacted in non-dollar currencies (yuan, euro, etc.). This is up from effectively 0% decades ago. The U.S. dollar's share of global reserve assets has slipped to its lowest in 25 years.

These trends have accelerated new geopolitical realignments. For instance, Saudi Arabia (linchpin of the petrodollar) has flirted with selling oil in yuan and joined China-led security and economic initiatives. In short, the monopoly is cracking at the edges.

Faced with this, the U.S. has begun pushing back on all fronts to defend the dollar's primacy. Beyond military actions, the Trump administration has even promoted dollar-pegged stablecoins (digital dollars) to ensure the greenback's dominance extends into the crypto age. It has threatened tariffs on nations exploring dollar alternatives (even the BRICS).

Gaining control over Venezuela's oil and excluding China/Russia from it is part of the same defensive playbook. It's the financial equivalent of a king defending a weakening realm by fortifying key castles and sacking any vassal who shows signs of rebellion.

Market Implications

In the near term, the Venezuela conflict (and similar U.S. currency-defense moves) elevate geopolitical risk and volatility. Investors instinctively hedge when superpowers clash over strategic resources. For example, the U.S. move on Venezuela's regime in late 2025 sparked a rush into safe havens. Gold has surged near record highs on the back of these tensions. European defense stocks likewise jumped around 15% in a month, anticipating conflict-driven demand.

The prospect of a major geopolitical rift (say U.S. intervention in Venezuela, or worsening U.S.-China proxy tensions) can also put downward pressure on the U.S. dollar in the long run. This happens if it undermines global confidence in U.S. leadership. In fact, some investors fear that aggressive U.S. actions (like threatening NATO allies over Greenland, or using force to maintain currency dominance) could "shatter the global order and damage the dollar" itself if they backfire.

The larger takeaway, however, is about the coming transition in the monetary system. All currency supremacy eras come to an end. And they tend to end with a crescendo of conflict and crisis. We appear to be entering that phase for the dollar-led system.

The U.S. can delay the erosion of dollar dominance (through sanctions, military moves, diplomatic pressure), but it likely cannot forever stop the trends that are eroding it. Nations worldwide have received the message loud and clear: relying solely on the dollar (and U.S.-controlled payment networks like SWIFT) is a vulnerability.

So they are hedging their bets. Accumulating gold, launching alternative payment systems (e.g. China's CIPS), experimenting with central bank digital currencies (CBDCs), and even exploring commodity-backed or BRICS currencies. Each U.S. enforcement action probably accelerates these efforts.

As one Reuters columnist noted, these extreme U.S. actions could be seen as "a sign of desperation" that hastens the decline of the petrodollar if other nations band together in response. History shows that using fear to preserve a monetary order ultimately fractures it. Allies and adversaries alike start planning for a new game.

Investment Takeaway

For investors, the writing is on the wall. We are on the cusp of a new financial order. The defense of the petrodollar by force is the last act in a long play, before the script gets rewritten. The opportunity (and obligation) now is to position oneself on the right side of that monetary reset.

Fighting the system head-on is futile. We aren't going to change grand geopolitical trajectories. But we can align our portfolios with the inevitable shifts. That means accumulating the assets that tend to retain value and thrive through currency regime changes. We highlight two categories:

Timeless Hard Assets

Gold and silver are obvious candidates. They have outlasted countless currency regimes and consistently serve as safe havens when fiat systems wobble. Indeed, gold is already behaving as an anchor, and we expect that to continue (with even more upside if trust in the dollar erodes further).

Other real assets like quality real estate, essential commodities, or stakes in productive infrastructure can also preserve wealth through turmoil. When fiat currencies are in flux, tangible value shines.

Next-Generation Financial Infrastructure, Blockchain & ISO 20022 Assets

We believe certain blockchain technologies and digital assets will form the backbone of the new financial system emerging from this transition. In particular, networks that facilitate efficient cross-border transactions and comply with the coming global standards (like ISO 20022 for financial messaging) are poised for massive upside.

For instance, Ripple (XRP) became the first distributed ledger tech company on the ISO 20022 standards body in 2020, and its RippleNet network is ISO 20022 compliant. It effectively serves as a bridge between crypto and traditional banking. Stellar (XLM) is similarly aligned. It's often cited among the digital currencies meeting ISO 20022 standards, and implementations have shown it could move trillions in traditional assets over its rails.

Other protocols like XDC, Algorand, Quant, and IOTA are also positioning to integrate with or complement the new standard and the broader shift to digital finance. The common thread is that these networks are designed to interoperate with the existing financial plumbing (which is migrating to ISO 20022 by 2025-2026). They provide faster, more secure, and more transparent settlement of value.

As confidence in legacy systems wanes, capital will seek out trust-minimized, technologically superior rails. We foresee ISO-compliant and utility-driven cryptocurrencies becoming core components of global finance. Their value could rise exponentially as adoption increases.

In a world where central banks themselves may introduce digital currencies, the infrastructure that connects diverse ledgers and ensures liquidity (the role tokens like XRP, XLM, etc. aim to play) will be in high demand. These digital assets are essentially investments in the new "railroad" of global finance.

In practice, our strategy is to accumulate positions in select cryptocurrencies that have clear utility in the envisioned new system (while avoiding the speculative fluff). We pair those with increased allocations to gold, silver, and high-quality resource equities. We also favor assets like well-run commodity producers and essential farmland. These are tangible plays that benefit from any dollar depreciation and inflation that might come with a realignment of currencies.

This two-pronged approach (old-world hedges plus new-world tech) creates a robust portfolio for the end of a currency era. As we often remind clients: don't bet against the cycle. The U.S. dollar's supreme cycle is turning, and those who position ahead of the reset (into the assets that the new system will favor) stand to reap enormous rewards.

The Venezuela saga and others like it are simply signposts along this journey. Our job as investors is to read those signs and stay ahead of the pack.

Trump's Tariff Playbook and the Greenland Gambit: Volatility as Opportunity

Just when markets had begun to tune out the trade war rhetoric of the last cycle, President Trump unleashed a new tariff shock. This time not at China, but at America's own allies in Europe.

In January 2026, Trump announced sweeping tariffs (10%, rising to 25% by mid-year) on imports from eight European nations "until the U.S. is allowed to buy Greenland." Yes, Greenland. The resource-rich Arctic territory of Denmark that Trump has long coveted.

The Greenland tariff gambit might sound bizarre, but it perfectly fits Trump's well-honed negotiation playbook. For investors, it's crucial to understand this playbook because it turns short-term market volatility spikes into trading opportunities. We've studied every tariff maneuver over the past year, and the pattern of market reaction has repeated almost verbatim.

Consider this your step-by-step guide to Trump's tariff-driven market cycles:

1. The Cryptic Threat ("Head-Fake Friday")

It often begins with a terse, provocative statement from Trump on social media late in the week. For example, on a Friday he might hint at "big action" or dissatisfaction with a trade partner (in the Greenland case, he threatened Denmark with tariffs in a tweet on a Friday). Markets start to wobble into the Friday close as uncertainty rises. A mild risk-off drift in stocks, perhaps a bid for safe-havens.

2. The Shock Announcement (Weekend Bombshell)

Within a day or two (frequently on a Saturday when markets are closed), Trump drops the bomb. A formal announcement of major new tariffs, often 25% or even 100%, with a short fuse. In this Greenland episode, he unveiled tariffs on a weekend (Saturday) catching everyone off-guard.

In October 2025's China flare-up, he similarly announced a potential 100% tariff on all Chinese imports effective just 21 days later. The timing is deliberate. By making the announcement when markets are closed, maximum psychological impact is achieved. Everyone has to stew over the news for at least a day, imagining worst-case scenarios.

3. Escalate Rhetoric & Counter-Responses (Information Vacuum)

Over the rest of the weekend, Trump typically doubles down publicly. Multiple posts and comments reinforcing that he's "serious" this time, even as advisors hit the talk shows. The targeted countries respond with defiant statements or openness to talks (often both). By Sunday, global news is running hot takes on trade war Armageddon. Importantly, nothing can really price yet. It's all anticipation.

4. Initial Market Shock (Futures Plunge, Monday Mayhem)

When markets finally reopen (Sunday evening for futures, or Monday if a holiday intervenes), the reaction is explosive. Equity futures gap down significantly, volatility spikes. We've seen S&P 500 futures down 2-3% overnight on such tariff threats (e.g., the October 10, 2025 China tariff threat saw futures initially dive, extending the S&P's losses that day).

European markets (if they open first) tank. Safe-haven assets like U.S. Treasuries, the Japanese yen, and gold jump. It's a classic "sell first, ask questions later" response.

5. Realization Phase (Tuesday-Wednesday)

After the initial panic, cooler heads start parsing the details. A key element in Trump's playbook: these tariffs are threats with a future effective date (in the Greenland case, Feb 1 for 10% tariffs, with escalation to 25% by June if no deal). That window means there is room for negotiation and possibly averting the worst outcome.

By Tuesday, markets often rebound off the lows as investors realize the tariffs aren't actually in force yet. Dip-buyers step in, reasoning that Trump's endgame is a deal, not indefinite tariffs. In 2025's episodes, we saw mid-week relief rallies as investors wagered that talks would eventually reduce the damage.

Additionally, by a few days in, there's often news that negotiations are happening behind the scenes or that foreign leaders are seeking dialogue.

6. Secondary Jitters & Smart Money Inflows

Though a relief rally can lift markets off the lows, it's not usually a straight line up. By mid-week, if no concrete progress is announced, we often get a second wave of volatility. Perhaps a retest of lows as more nervous headlines hit (e.g., "No breakthrough yet"; threats of counter-tariffs by the other side).

This is typically when smart money starts quietly accumulating. They've seen this movie before. They know that by around the 1-week mark, Trump will likely hint at talks or send out optimistic signals to stabilize markets (he doesn't actually want a crash).

Our team was able to nearly double the S&P's return in 2025 largely by moving early in these moments. We scaled into positions when panic was high and valuations temporarily cheapened.

7. The Deal Tease (Weekend 2)

Roughly a week after the initial threat, Trump often tweets that discussions are "going well" or that the targeted country is "coming to the table." For instance, in past flare-ups he'd announce upcoming meetings or say negotiators are making progress. If not Trump, then senior officials like the Treasury Secretary might float hopeful comments.

By the second weekend, the narrative often shifts to "we're working on a solution." In the Greenland case, we might hear that U.S. and Danish officials are meeting, etc.

8. Relief Rally (Week 2+)

That Sunday night or Monday (about 10 days out), markets tend to gap up on optimism. Perhaps not fully back to pre-tariff levels, but significantly off the lows. The sentiment pendulum swings to "maybe it won't be so bad." We saw this in previous episodes where futures opened sharply higher after positive trade tweets, though those gains might moderate as trading gets underway.

9. Prolonged Negotiation & Headlines (Weeks 2-4)

Over the next couple of weeks, markets stabilize and often grind higher, albeit with headline-induced zigzags. Every comment from either side ("talks constructive" or "talks stall on XYZ") causes minor ripples, but the overall trajectory is recovering.

Investors who panic-sold at the bottom often watch in regret as prices recover. Those who bought the dip have a cushion. Trump, for his part, continues a mixture of praise ("They really want a deal") and pressure ("If they don't give us Greenland, tariffs will go up!"), maintaining leverage.

10. Eleventh-Hour Deal (Cliff Averted)

In nearly every instance so far, Trump has struck some form of deal or truce just before the tariffs actually hit their deadline. The pattern is clear: the tariffs are a negotiating tactic, not an end goal.

In the October 2025 China case, on the very day the 100% tariffs were to kick in (Nov 1), Trump announced a new trade deal with China. This included China's removal of rare earth export curbs that had been hurting U.S. industry. Essentially, he got a concession and then called off the doomsday tariff at the last minute.

We expect a similar approach on Greenland. Trump's maximalist opening bid (buy Greenland or suffer tariffs) will likely be negotiated down to some face-saving compromise (perhaps increased U.S. presence or mineral rights in Greenland, or greater Danish defense spending, etc.). At that point tariffs will be lifted before crippling trade.

When that deal comes, markets typically celebrate. Equities rally hard, particularly sectors that were directly targeted. By then, volatility subsides and we often see new equity highs following the resolution. In 2025, once trade peace was restored, the S&P 500 and other indices surged to record levels as the cloud of uncertainty lifted.

11. Repeat

Having used the playbook successfully, Trump tends to shelve it for a few months while markets breathe easier. Until the next opportune moment or grievance emerges. Then the cycle repeats with a new target (be it another country or another product category). It's episodic.

Indeed, by late 2025 investors started to recognize the pattern, and market reactions became a bit more muted in subsequent flare-ups. This reflected a learning curve.

The Greenland episode adds a twist in that Trump's demand (acquiring territory) is far more ambitious than tweaking a trade imbalance. This could make negotiations more protracted or the confrontation with Europe more heated than the disputes with China over exports.

So while we expect the same general sequence, the timeline might stretch out longer or involve more brinkmanship. European leaders have already closed ranks ("Europe united" behind Denmark) and threatened retaliation if U.S. tariffs materialize. The stakes (potentially fracturing NATO alliances) are high.

This means volatility could be higher and last longer before resolution. But ultimately, we doubt the tariffs become permanent. Both sides have incentives to deal. Trump wants Greenland. A deal of that magnitude will take time, so he'll likely accept something short-term that he can spin as a victory, then perhaps revisit the issue later. European economies want to avoid a tariff war, especially given the U.S. is a key trade partner. So a face-saving compromise is the most probable outcome after a noisy standoff.

Market Perspective

Active investors can play this cycle by selling euphoria and buying panic on a short-term basis. It's not often you get semi-predictable 3-5% swings in major indices within days, tied to a political script. But over the last year, Trump's tariff theater provided exactly that.

Our trading desk capitalized on these swings. For instance, by shorting or hedging just after a complacent rally when trade tensions seemed "gone," and then flipping long when the inevitable overreaction plunge came. By staying objective and systematic rather than succumbing to each bout of fear, we turned volatility into opportunity.

In 2025, this approach contributed to our strategy significantly outperforming the market (in fact, our internal fund nearly doubled the S&P 500's return, largely thanks to agile trading around trade war news bursts). The key is discipline. Follow the playbook, don't trade the emotions. When everyone else is panicking that "this time it's different, this time trade war might not get resolved," check the incentives and likely endgame. Conversely, when everyone relaxes thinking "trade risk is off the table," stay alert. Another bout could be around the corner.

For longer-term or more conservative investors, the takeaway is slightly different. Even if you don't trade in and out, you can manage these episodes with hedging and portfolio rebalancing. For example, when a tariff threat emerges (Step 2/3 above), you might temporarily increase hedges or raise a bit of cash, then deploy that cash into quality assets at a discount when the market swoons (Step 4/5).

Ensure you're not over-levered heading into known risk windows (e.g., if Trump hints on Friday at an announcement, maybe lighten up on very risk-sensitive positions or buy some index puts for protection). Then as clarity returns and markets recover, you can unwind hedges and resume normal allocations.

The point is to recognize that this volatility is by design. As we noted, it has become an "episodic headwind." A recurring series of mini-crises that knock markets back, only to fade away. Knowing this, one can steel themselves not to overreact to the initial shock.

In fact, by the second half of last year, many investors started to largely view these tariff threats as noise, especially after seeing Trump strike deals one by one. That perspective is healthy. It prevents costly panic sells and opens the door to profit from the rebound.

Investment Takeaway

Volatility is opportunity. The return of Trump's tariff tactics (now aimed at Europe/Greenland) reinforces our conviction that an objective, rules-based approach to geopolitical headlines is essential.

We will continue to follow our Tariff Playbook strategy:

• Stay alert for the telltale signs of a new trade flare (late-week tweets, etc.).
• Do not overreact by dumping core positions in fear. Remember that tariffs are a means to an end (a deal), not likely permanent.
• Use hedges tactically. For instance, one might buy short-term VIX calls or put options on an index as cheap insurance on Friday if a tariff bomb seems likely over the weekend.
• When the inevitable sell-off hits, step in calmly. Identify high-quality names that are down unjustifiably and scale into positions. History shows these drops reverse once negotiations progress. For example, if European equities plunge 5% on Greenland fears, one might accumulate shares of solid European multinationals or U.S. companies with Europe exposure knowing that an eventual deal will remove the overhang. Already, some investors are eyeing opportunities in oversold Danish or Northern European assets, figuring the worst-case (25% tariffs) won't actually transpire.
• As news improves, trim and take profits into the relief rallies. Rinse and repeat if necessary.

For more passive investors or institutions, the advice is to maintain perspective and possibly even ignore the short-term noise. If our analysis is correct, these tariffs will not last. They are negotiating levers. So, the fundamental values of companies or the economy aren't changing as dramatically as the headlines imply.

Staying invested in a diversified portfolio, perhaps with a tilt toward quality and domestic-oriented businesses, can be wise. If volatility keeps you up at night, use it as an entry point for assets you wanted to own at better prices rather than as a reason to abandon your strategy.

In all cases, remember that the market's initial reaction is often an overreaction. As one strategist noted, investors have grown "resilient in the face of unthinkable sorts of developments," realizing that much of it "doesn't move the needle on asset prices" in the medium term. We agree.

Beneath the dramatic day-to-day swings, the structural bull market remained intact through prior tariff episodes, and likely will again, until a truly systemic issue emerges. In the interim, use the noise to your advantage.

Conclusion: Navigating Noise and Positioning for the New Financial Era

Today's geopolitical climate is rife with spectacle. A Fed Chair threatened with indictment. An oil-rich nation at the center of a great power tug-of-war. A U.S. President threatening allies with economic war unless they cede territory. These events can jolt markets and test our composure, but they also validate a key principle of our research. The louder the political and media noise, the more critical it is to focus on the underlying signals driving the economy and markets.

Across the DOJ vs. Fed clash, the Venezuela conflict, and the Greenland tariff gambit, the underlying theme is transition. The global financial system is shifting beneath our feet. The end of the easy-money era has brought out political brinkmanship. The erosion of U.S. dollar dominance has spurred geopolitical confrontations. And the return of tariff diplomacy signals a more fragmented world order.

For investors, these are not random disparate events but interconnected threads in a larger tapestry. The old monetary regime struggling against the forces of change.

Our stance is clear-eyed and pragmatic:

• Monetary policy will ultimately bow to liquidity needs, not political grandstanding. The Fed will inject liquidity (cut rates, etc.) when the system calls for it, DOJ threats notwithstanding. Thus, we keep our eyes on credit markets and inflation dynamics to time our moves, not on partisan drama.
• Geopolitical conflicts often mask economic motivations. Venezuela isn't about ideology or drugs. It's about oil and dollars. By recognizing the true drivers (e.g., defending petrodollar flows), we can better anticipate policy actions and invest accordingly (like increasing our gold/commodity exposure knowing the dollar system is under strain).
• Trump's negotiation tactics are a known quantity. Disruptive but navigable. Rather than living in fear of the next tweet, we maintain a playbook that turns these disruptions into alpha. The global trade environment may be more uncertain, but it's also more tradable for those who stay disciplined.

The new financial system is coming. Whether it fully arrives in 2 years or 10, the trends are unmistakable. Multi-currency trade, digital payment rails, CBDCs, and integrated ledgers. The eventual outcome might even be a "Bretton Woods III" of sorts. Perhaps a neutral reserve asset or coordinated digital currency framework to stabilize a fracturing system.

We don't pretend to know exactly what form it takes, but we know what inputs will likely be involved: blockchain networks, tokenized assets, and some return to real assets to backstop trust. Thus, we position in those areas now, while many are still undervalued or under-owned by institutions.

In summary, do not be distracted by the theater. The DOJ vs. Fed saga, the Venezuela operation, the Greenland tariffs. They are chapters in a story of a changing world. Our job as investors is to read between the lines and act on what truly matters.

At PULP Research, we remain focused on the core signals: sentiment, liquidity, structural cycles, and technological adoption. The narratives may grow more extreme (indeed, we expect increasingly radical headlines as this cycle climaxes), but if you maintain intellectual honesty and a long-term perspective, you can turn even the wildest headlines into profitable decisions.

As we face 2026 and beyond, we encourage investors to zoom out. The coming years could bring bouts of volatility and confusion, but also immense opportunity. Volatility, after all, is not to be feared. It is to be capitalized on.

By preparing now (building a resilient portfolio of real assets and high-utility digital assets, keeping some dry powder for dislocations, and perhaps most importantly, by filtering out noise), you put yourself in a position not just to survive the transition, but to thrive in the new paradigm that follows.

Be careful with the information you absorb, exercise sound judgment, and stay focused on the big picture. The main stage will always be full of sound and fury. But it's our job to tune into the signal: the liquidity flows, the incentive structures, the technological shifts. Those are what drive markets in the end. And those are precisely where we see the next great investment opportunities unfolding.

- PULP Research