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Andermatt is a small mountain village in the Swiss Alps. It's a few hours from Zurich, it's known for its skiing and snowboarding, and it's surely really beautiful. But right now it has two other important things going for it: one, it does not restrict property purchases by foreign nationals and, two, it does not limit the construction of second homes to 20% of the village's housing stock, which is a rule in other places. This is expected to come into force in Andermatt in 2040.
Because of these features, Andermatt is being viewed as a barometer for foreign demand and, over the last six weeks in particular, local developers and agencies are reporting "hockey stick growth" in terms of sales volume and inquiries (according to FT). As of April 10, new development projects in the village reported selling SFr14.2mn worth of apartments, which is nearly 2x the amount of transactions for all of 2024. And nearly a third of these deals were signed by "nervous Americans" following April 2.
Here's one buyer testimonial:
One Andermatt buyer, a New York-based tech entrepreneur in his early fifties who asked to remain anonymous, said Trump was one of the “main factors” in his decision to buy. He and his partner purchased a two-bedroom unit for SFr2.2mn in November. Switzerland, he said, was stable and secure at a time when the US was less so under Trump. “It is not only financial uncertainty — it is not liking what [the US] is turning into and what it has become,” he said.
It is not uncommon for people to say, "if X happens, then I'm going to leave and move to Y." That doesn't always, or even oftentimes, materialize. But wealthy people have the means to make it happen, if they want, and we're seeing signs of it all across Europe. In some cases, putting down a deposit on a new Swiss apartment might just be an option, should things get worse. And in other cases it may be a firm commitment to relocate.
But either way, it's a strong indicator and a demonstration of people voting with their feet.
We all know what happened this week:
Donald Trump’s decision on April 2 2025 to enact sweeping “reciprocal” tariffs on US trade partners will go down as one of the greatest acts of self-harm in American economic history. They will wreak untold damage on households, businesses and financial markets across the world, upending a global economic order that America benefited from and helped to create.
We also know it was based on highly questionable math:
His “reciprocal” levies amount to a back-of-the-envelope calculation. They take trade partners’ US trade deficit in goods as a share of imports from that country, and then divide it by two. This is not a calibrated attempt to equalise tariff and non-tariff barriers facing US exporters, perceived or otherwise. It is, however, a reckless repudiation of all trade agreements the US has signed, as well as a deeply flawed plan to attract foreign manufacturing investment.
So what happens next?
Assuming this behavior persists, the US will continue to isolate itself from global trade, and the rest of the world will pivot and quickly move to trade more freely among themselves. This maybe isn't as problematic as some might think. Today, the US represents about 13.5% of global goods imports, which is down from almost 20% in 2000. And the biggest drivers of global growth are now China and the Euro area.
To that end, here's a fascinating study from IMD Business School that looked at how long it will take for various trading partners to completely wean themselves off of the US. And to do this, they looked at non-US import growth for the 10-year period from 2012 to 2022, and then extrapolated.
It is often difficult to grasp. This is why when you look at an empty piece of land, it can sometimes be difficult to visualize actually fitting a building on it. And why when you look at an empty room, it's common to think, "there's no way that furniture will fit in here." But in the end, it does fit.
It also tends to be relative. Here in North America, it is common to argue over things like parking space dimensions and drive aisle widths. We'll say things like, "well, people like their big cars." But then you travel to Europe and you find streets like this:
Andermatt is a small mountain village in the Swiss Alps. It's a few hours from Zurich, it's known for its skiing and snowboarding, and it's surely really beautiful. But right now it has two other important things going for it: one, it does not restrict property purchases by foreign nationals and, two, it does not limit the construction of second homes to 20% of the village's housing stock, which is a rule in other places. This is expected to come into force in Andermatt in 2040.
Because of these features, Andermatt is being viewed as a barometer for foreign demand and, over the last six weeks in particular, local developers and agencies are reporting "hockey stick growth" in terms of sales volume and inquiries (according to FT). As of April 10, new development projects in the village reported selling SFr14.2mn worth of apartments, which is nearly 2x the amount of transactions for all of 2024. And nearly a third of these deals were signed by "nervous Americans" following April 2.
Here's one buyer testimonial:
One Andermatt buyer, a New York-based tech entrepreneur in his early fifties who asked to remain anonymous, said Trump was one of the “main factors” in his decision to buy. He and his partner purchased a two-bedroom unit for SFr2.2mn in November. Switzerland, he said, was stable and secure at a time when the US was less so under Trump. “It is not only financial uncertainty — it is not liking what [the US] is turning into and what it has become,” he said.
It is not uncommon for people to say, "if X happens, then I'm going to leave and move to Y." That doesn't always, or even oftentimes, materialize. But wealthy people have the means to make it happen, if they want, and we're seeing signs of it all across Europe. In some cases, putting down a deposit on a new Swiss apartment might just be an option, should things get worse. And in other cases it may be a firm commitment to relocate.
But either way, it's a strong indicator and a demonstration of people voting with their feet.
We all know what happened this week:
Donald Trump’s decision on April 2 2025 to enact sweeping “reciprocal” tariffs on US trade partners will go down as one of the greatest acts of self-harm in American economic history. They will wreak untold damage on households, businesses and financial markets across the world, upending a global economic order that America benefited from and helped to create.
We also know it was based on highly questionable math:
His “reciprocal” levies amount to a back-of-the-envelope calculation. They take trade partners’ US trade deficit in goods as a share of imports from that country, and then divide it by two. This is not a calibrated attempt to equalise tariff and non-tariff barriers facing US exporters, perceived or otherwise. It is, however, a reckless repudiation of all trade agreements the US has signed, as well as a deeply flawed plan to attract foreign manufacturing investment.
So what happens next?
Assuming this behavior persists, the US will continue to isolate itself from global trade, and the rest of the world will pivot and quickly move to trade more freely among themselves. This maybe isn't as problematic as some might think. Today, the US represents about 13.5% of global goods imports, which is down from almost 20% in 2000. And the biggest drivers of global growth are now China and the Euro area.
To that end, here's a fascinating study from IMD Business School that looked at how long it will take for various trading partners to completely wean themselves off of the US. And to do this, they looked at non-US import growth for the 10-year period from 2012 to 2022, and then extrapolated.
It is often difficult to grasp. This is why when you look at an empty piece of land, it can sometimes be difficult to visualize actually fitting a building on it. And why when you look at an empty room, it's common to think, "there's no way that furniture will fit in here." But in the end, it does fit.
It also tends to be relative. Here in North America, it is common to argue over things like parking space dimensions and drive aisle widths. We'll say things like, "well, people like their big cars." But then you travel to Europe and you find streets like this:
What this chart says is that by the end of this year, some 70 US trading partners could, in theory, replace the loss of the US export market so long as non-US growth continues as it did in the past. And by 2039, the number jumps to over 140 trading parties. 2039 is obviously a long ways away, but I think it's noteworthy that year one in this specific chart already starts with 70.
Importantly, Canada does not fall within this initial bucket. Based on the study, we are in the danger zone. That is, exports to the US make up more than 10% of our GDP and it will take more than 10 years for full export recovery. But again, this is based on historic non-US growth. So all this means is that the status quo cannot continue; we need to dramatically increase this growth rate and do it as quickly as possible.
I hope our leaders recognize the urgency of this, because nothing can be taken for granted when it comes to the US right now. We need to be hyper focused on full trade recovery as soon as possible. Canada needs to be open for business to the world.
And this:
The first is only marginally bigger than the width of a parking space in Toronto (2.6 meters). And the latter is only marginally bigger than the width of a typical two-way drive aisle (6 meters). So are these too small? Well, it depends on your perspective.
If your basis of measurement is the size of cars, then these streets will seem too small. Cars also keep getting bigger, so you have this inflation factor to deal with. But if your basis of measurement is something else, such as walkability, then maybe they're just right.
What this chart says is that by the end of this year, some 70 US trading partners could, in theory, replace the loss of the US export market so long as non-US growth continues as it did in the past. And by 2039, the number jumps to over 140 trading parties. 2039 is obviously a long ways away, but I think it's noteworthy that year one in this specific chart already starts with 70.
Importantly, Canada does not fall within this initial bucket. Based on the study, we are in the danger zone. That is, exports to the US make up more than 10% of our GDP and it will take more than 10 years for full export recovery. But again, this is based on historic non-US growth. So all this means is that the status quo cannot continue; we need to dramatically increase this growth rate and do it as quickly as possible.
I hope our leaders recognize the urgency of this, because nothing can be taken for granted when it comes to the US right now. We need to be hyper focused on full trade recovery as soon as possible. Canada needs to be open for business to the world.
And this:
The first is only marginally bigger than the width of a parking space in Toronto (2.6 meters). And the latter is only marginally bigger than the width of a typical two-way drive aisle (6 meters). So are these too small? Well, it depends on your perspective.
If your basis of measurement is the size of cars, then these streets will seem too small. Cars also keep getting bigger, so you have this inflation factor to deal with. But if your basis of measurement is something else, such as walkability, then maybe they're just right.
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