Outside In | What Typhoon Mangkhut could teach Donald Trump about the brewing global economic storm

David Dodwell says while Hong Kong’s long-term investment in infrastructure helped limit the damage to the city from the super typhoon, the global economy is less prepared for the inevitable coming crash

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A schoolboy surveys the damage in the wake of Typhoon Mangkhut on Tin Ping Road in Sheung Shui on Thursday. The intense preparation before the typhoon struck helped Hong Kong limit the damage caused by the storm. Photo: Sam Tsang

Published: 4:01pm, 21 Sep 2018Updated: 10:32pm, 21 Sep 2018

There was something marvellously symmetrical about Typhoon Mangkhut striking exactly on the 10th anniversary of the global financial crisis that followed the Lehman Brothers crash.

As I watched the awe-inspiring havoc caused by raw nature as winds tore out more than 15,000 trees, smashed windows and threw hundreds of boats onto rocks and beaches – my home overlooks a bay in which several boats were destroyed that day – I could imagine US regulators surveying financial markets back in September 2008 as the awesome scale of the crash became clear. The sense of powerlessness as the storm bore down must surely have been similar.

For a brief while, it put US President Donald Trump’s trade war and his “fire and fury” rhetoric into much-needed perspective.

But as I recalled the clear skies and fierce heat in Hong Kong for the two days before Mangkhut arrived, I was reminded of the calm that comes before storms and the beguiling and seemingly unstoppable present strength of US equity markets, now at all-time record levels.

I am concerned that it is this unsustainable bubble that has given Trump’s administration the facile confidence to engage in such a reckless assault on a global trading system that has driven growth and built wealth for most countries worldwide over the past seven decades – foremost among them the US.