The End of the Long Cycle

Welcome back to The Forecast from Bloomberg Weekend, where we help you think about the future — from next week to next decade.

This week we’re looking at the new geopolitical order, and why there’s no going back. Also, creatine sales will keep booming, climate change might make winters colder and more.

French historian Fernand Braudel identified three cycles of history. The shortest is the day-to-day flow of events; Braudel called them “fireflies” on the stage. Next up are paradigm shifts — like the end of the Cold War — that can play out over decades or longer. Finally, there’s the longue durée: the bedrock of climate and geography that shapes everything else and changes only over centuries or millennia.

Six months into US President Donald Trump’s second term, it’s clear that the course of events has changed. What’s the collective noun for a group of fireflies? Probably not “paradigm shift,” but in this case that’s what it adds up to.

The US pivot from free trade and global security to a sharper focus on the national interest has the makings of a decades-defining transformation, reversing the global integration supercharged by the end of the Cold War.

In the decades after World War II, the US was the champion of free trade, the anchor for global security and the gold standard on governance. Now, it has raised tariffs to the highest level since the 1930s, told allies they need to pay for protection and crossed red lines on independence for the Fed and statistical agencies.

That’s a major break, and an important moment for the global economy, shifting patterns of growth and inflation, borrowing and debt.

The geopolitical landscape has shifted just as decisively. Jolting though it is, Trump’s focus on America First is a reflection of a new reality where the US is no longer the world’s sole superpower. Regardless of who occupies the White House next, US allies and adversaries will continue to reorient around that new state of affairs.

How about Braudel’s longue durée — the slowest moving cycle of history on which everything else rests? Could even that be at an inflection point? Maybe.

Trump has pulled the US out of the Paris climate agreement, again. The global fight against climate change will continue, but without the world’s second-largest emitter, it gets harder. The arrival of artificial general intelligence could also prove an epochal shift.

“History,” Braudel wrote, “may be divided into three movements: what moves rapidly, what moves slowly and what appears not to move at all.” Right now, events are moving almost too fast to track and the slow-moving Pax Americana is heading rapidly toward the dustbin of history. If global temperatures rise much further or machines start thinking for themselves, there will be movement even in the cycle that appears not to move at all.

— Tom Orlik is the chief economist for Bloomberg Economics and Jennifer Welch is the chief geoeconomics analyst.

The new American hustle is dividends over day jobs. “Jaded Gen Zers hellbent on quitting and retiring early… [are] piling into ETFs offering eye-popping yields generated by complex derivatives.” — Denitsa Tsekova and Vildana Hajric, Bloomberg Markets

Women and older men will drive creatine sales even higher. The market for the supplement will quadruple to $4.2 billion by 2030, according to one market research firm. — Redd Brown, Bloomberg News

GLP-1s might revolutionize the treatment of Alzheimer’s disease. Clinical trial results are due this fall from Novo Nordisk A/S, after diabetes patients taking the drugs appeared to get dementia at noticeably lower rates. — Naomi Kresge, Bloomberg Businessweek

Climate change could usher in “a world of frozen winters and parched summers.” But it all “depends on what happens in the Atlantic Ocean.” — Lara Williams, Bloomberg Opinion

The next AI breakthrough will be kept secret, a shift from the days when the major advances were published in scientific journals. — Julia Love, Bloomberg Businessweek

“America’s dominance in the Olympics is primed to take a hit” as payments to student football and basketball players push colleges to cut spending on sports like swimming and track. — Janet Lorin, Bloomberg News

Trump vs. US Cities

Last week, Trump told reporters that he would send the National Guard to Chicago, following his decision to deploy them in Washington, DC last month. Will he follow through? And will other cities be in for the same treatment?

Kalshi has a prediction market tracking this question, with the outcome determined by the New York Times — and a modest $130,000 in trading volume as of this writing. (Forecast as of 3 p.m. ET on Friday.) As of now, a deployment in Chicago is likely but not certain; deployment in New York this year is trading at just 35%.

Bond Vigilantes Visit France

The French political system is paralyzed. The electorate and businesses are tired of tax rises. The fragile minority government under François Bayrou, the fourth prime minister in two years, wants to make cuts worth €44 billion, but it faces a “block everything” movement that rejects any kind of austerity. It will likely fall in a confidence vote on Monday, and be replaced by another weak administration that will find it hard to pass a budget.

The bond markets have taken notice.

“The bond vigilantes are circling over several targets right now: France, the UK, and Japan. But France is the most vulnerable,” said Dhaval Joshi, chief strategist at BCA Research. “France needs a political solution, but French politics are in gridlock. Ultimately, therefore, it may take the bond vigilantes to force France’s destiny.”

— William Horobin and Alice Gledhill, Bloomberg News

Read the full Bloomberg Big Take here.

Sunday: OPEC+ meets to decide on oil production.

Monday: French Prime Minister François Bayrou faces a confidence vote over his budget; Brazilian President Luiz Inácio Lula da Silva leads a virtual BRICS summit in response to US tariffs; Norway holds parliamentary elections; Japan reports GDP; China reports exports.

Tuesday: Mexico reports CPI; Oracle reports earnings.

Wednesday: Brazil, Argentina and China report CPI.

Thursday: The US reports CPI; the ECB is expected to leave interest rates unchanged.

Friday: France, Germany, Spain and India report CPI; the University of Michigan publishes its US consumer sentiment index.

Have a great Sunday and a productive week.

— Walter Frick and Katherine Bell, Bloomberg Weekend

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