Global investors are turning their backs on the US economy as a “Trump Dump” movement takes hold in global capital markets.

It’s not just about individual companies and their fortunes — though Tesla continues to star in the horror show that is the US sharemarkets since investors realised in mid-February what a nightmare Mad King Donald really is. Reichsleiter Musk’s company is down another 5% this week alone, taking its losses since the Trump-fuelled highs of last November to more than 50%, or more than US$700 billion. Tesla is now worth less than Musk’s vehicle for disrupting air traffic, wrecking astronomy and raining debris down from the skies, SpaceX.

But the broader US share market continues to plunge. The S&P 500 was down 1% on Monday on top of a 10% fall over the past month — a loss of US$5 trillion in value. The Nasdaq was down nearly 2%.

The reason: as Bank of America’s monthly survey of big global investors revealed, investors are bailing out of US shares at record levels. A net 23% of investors report being underweight US stocks, compared to a net 17% overweight in February. This marks a 40-percentage-point swing in US equity allocation within a month — the largest on record.

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Where are investors heading? One of Trump’s key targets: Europe. A net 39% of fund managers now hold an overweight position in European equities, up from 12% last month and the highest level since mid-2021. Europe’s key STOXX 600 index is up 8.5% so far this year, and the London market is up nearly 6%. It’s the biggest rotation in allocation on record.

These investors are worldwide fund managers, not American corporate executives who have spent months sucking up to Trump. The survey shows that big global investors now see Europe as a better risk, a bolt-hole compared with Trump-battered American markets.

A remarkable 83% of investors now expect US growth to slow, up from just 28% last month — the sharpest deterioration in sentiment in years. A net 60% of investors now expect stronger European growth in the next year, up from just 9% two months ago. Adding to the pro-Europe sentiment will be the success of incoming German chancellor Friedrich Merz in shepherding through a crucial package of financial reforms to boost the German economy and defence spending.

The survey showed that cash levels held by these big investors jumped sharply — a move that a clear-sighted Warren Buffett made in 2024 in anticipation of the chaos Trump would bring. Interestingly, they did not go heavily into bonds, usually the first port of call for nervy investors. Funds allocated to bonds in the US, Europe and Asia fell, a telling measure of the confusion and pessimism that have driven the Wall Street sell-off in recent weeks.

If Australian fund managers haven’t joined in the exodus from the US, they’ll be sitting on big paper losses, which will feed directly into all of our retirement savings. The Dump Trump vibe has infected investors here as well, pushing the ASX 200 down 6.6% in the past month and more than 4% so far in 2025.

Meanwhile the value of the Trump meme coin — remember that? — slumped more than 4% yesterday and is down more than 40% in the past month. Trump’s own Trump Media is down by more than 30% in the last month and 40% this year. Even the grifter himself can’t hold out against the flight of investors.

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