This week was Donald Trump’s first State of the Union. Wall Street is abuzz with rumors Trump is seeking to re-architect the global financial system. Plus his enforcers go hard-core on Google.

Anyway, the Trump theory is that the U.S. can essentially get other countries to maintain the U.S. as reserve currency, but correct some of the imbalances it fosters and essentially force other nations to stop free-riding off U.S. security and one-sided open markets. As Gillian Tett noted in the Financial times, “Bessent says Trump will ask other governments to put themselves into ‘red,’ ‘green’ and ‘yellow’ boxes — ie choose to be foes, friends or adjacent players. ‘Green’ countries will get military protection and tariff relief, but must embrace a currency accord. Some ‘yellow’ — or even ‘red’ — nations might cut transactional deals. There could be two stages with Mar-a-Lago, the thinking goes: one with allies and the second with others.”

At any rate, it’s not clear if there ever will be a “Mar-a-Lago Accord,” but the logic of it is where we’re heading. It’s already starting to happen, as Germany discusses getting rid of its “debt break.” And while Trump is widely distrusted, most of his arguments on foreign policy – Europe must re-arm, global imbalances must be corrected, the U.S. dollar as the reserve currency is too costly – have been widely understood for five or six decades. But global elites, including Wall Street, but also most foreign elites who love their dollar assets and export-led growth, freaked out whenever anyone tried to correct anything. But these things will get fixed, either through negotiation or through war. The latter is much more painful.