The rising "star" of the Trump administration may become a key factor influencing the market.

In the past few weeks, there have been some changes in the American political arena, and the market is still digesting these impacts. Most notably, Treasury Secretary Scott P. Besson has played a leading role among the president's advisors.

"He has become a big star," Trump said in Qatar on Wednesday. "Every time he appears on television, all the markets go up."

Since April, the stock market has been rising as the government has postponed or canceled punitive tariffs on imported goods. As a former hedge fund manager with keen insights into the market, Bessent has received praise in many areas for the shift in Trump's policies. He could also be blamed if things do not develop as expected by businesses, consumers, and investors. While being a "star figure" has its advantages, this role is equally fraught with risks, given Trump's capricious nature and the economic stakes.

Benson seems to be everywhere nowadays, actively promoting Trump's policy agenda and American interests. He is leading sensitive tariff negotiations with China and appeared in the Middle East alongside Trump over the past week, during which Trump promoted the government's claimed $2 trillion new investment. Benson is also expected to assist Congress in advancing this year's tax debate.

So far, the impact of Bessenet has been most evident in the shift regarding tariff issues. The S&P 500 index also rebounded, turning positive on May 13—just the day after the U.S. reduced tariffs on Chinese goods from 145% to 30% (plus some previously imposed tariffs).

Trump initially announced his tariff policy on April 2, claiming to "make the trade environment fair," and highlighted the high tariffs he plans to impose on all U.S. trading partners with a huge poster.

"That poster was really shocking," said Jens Nordvig, founder of market data company Exante Data, at a recent meeting of the Council on Foreign Relations. "Now everyone realizes that the poster was a mistake, and in fact, it has already been canceled."

He and many others believe that this change is due to the positive influence Bessent has had on Trump.

However, this impact is also limited. "Now our decision-making process is more rationally analyzed, but obviously, Bessent is not the president, he is not Congress, and he is certainly not the Senate," Nordweg said.

It is still uncertain whether the market can continue to disregard tariffs. The posters may have disappeared, but the 10% tariff on imported goods from almost all countries still exists, while the tariff on certain goods from China has risen to 55%.

"I don't know if the stock market has already noticed this news, nor am I sure if everyone is aware that the current tariffs are higher than what people expected a few months ago," said Karen Karniol-Tambour, co-CIO of hedge fund Bridgewater, at a meeting of the Council on Foreign Relations.

She stated that the current market conditions have not taken into account the expectations of an economic slowdown.

Any form of new global tariffs means that the domestic economy will suffer. Doug McMillon, the CEO of Walmart, bluntly pointed out during the earnings call on Thursday: "Even if tariffs are reduced, higher tariffs will still lead to price increases."

Global asset management company Allianz expects that this summer, the inflation rate measured by the consumer price index will reach 3.5%, up from 2.3% in April. For the United States, which was still angry over the skyrocketing egg prices last year, inflation is not moving in the desired direction. Moreover, this is not the situation the Federal Reserve wants to see when considering whether to lower interest rates.

Some people in the market believe that the tariff turmoil and the potential surge in inflation indicate that Bessent has failed to fully curb the president's instinctive impulses, which is a dereliction of his duty.

"Steven Mnuchin and Gary Cohn were willing to step up, whereas Bentsen was not," said a prominent CEO in the financial industry, comparing the current Treasury Secretary to his predecessor and former director of the National Economic Council during Trump's first term.

The government's view is that at the start of Trump's new term, the economic situation in the United States is extremely poor, and without Trump's intervention, the economy would quickly plunge into crisis. What is the solution? Bessent wrote in a commentary earlier this month in The Wall Street Journal that trade, deregulation, and tax cuts bring multiple benefits, and these measures will soon show results.

"The American people should expect to hear the roar of the economic engine in the second half of 2025," Bessent wrote.

If stock market investors hold such a view now, then the bond market is not so certain. In recent weeks, the term premium has increased, reflecting that traders demand higher returns for holding long-term debt in the face of economic uncertainty.

On Friday, Moody's downgraded the credit rating of the United States, making it the last of the three major rating agencies to strip the U.S. of its Aaa top rating. As a result of this news, the yield on the 10-year U.S. Treasury bond rose to nearly 4.5%, marking its third consecutive week of increases.

The rise in yields reflects the improvement in economic prospects as trade issues are no longer as prominent, and it also indicates concerns that Washington plans to rewrite the tax code this summer, which could lead to an increase in deficit spending by hundreds of billions of dollars. The Treasury will have to issue more government bonds in a context of weak demand, which could push yields higher.

"In the end, the market will see through the impact of this downgrade in credit rating," said Joseph LaVorgna, Managing Director and Chief Economist at SMBC Nikko Securities and former economic advisor to Trump.

Lavornia said: "The market has always been very tense. Once everyone realizes that the world will not head towards doom again as imagined in the past few weeks, you will see some premiums come down."

Moreover, this is not just because Bessent has performed well in recent weeks. "To be fair, Minister Bessent has had an outstanding track record for decades," Lavolna stated. "I believe he knows exactly what he is doing, and the market acknowledges and understands this."

As for whether Trump and Bessent truly had a clear understanding of the tariff issue back then, that will be left for historians to discuss. But it is clear that the current government has recognized that it can only drive the economy to a limited extent and speed. If Trump and his team can continue to manage the political agenda while listening to the market's voice, then the supporters of "Bessent economics" may ultimately be proven right.

But if they fail to do so, then this "big star" may face criticism.