Myron Scholes, the 1997 Nobel Prize laureate in Economics, recently visited Taiwan and spoke with Caifeng in an exclusive interview. He discussed a range of topics including the "Trump effect," artificial intelligence (AI) prospects, and his distinctive investment philosophy.

Scholes emphasized that adapting to constant change is central to his investment strategy. While he doesn't dismiss “buy-and-hold” strategies entirely, he believes they can overlook short-term risks. He also expressed concerns about tail events—unpredictable occurrences with significant potential for losses—which can amplify market risk even when diversification measures are in place.

Regarding Trump’s tariff policies, Scholes views policy instability as the primary concern; it increases industry transition costs and complicates investment decisions more than the tariffs themselves. Controlling inflation is also a major priority. He believes that if tariffs trigger another wave of inflation, an economic recession could follow. Scholes further explored AI's potential to boost productivity growth while acknowledging its limitations compared to human creativity.

Drawing on insights from "The Art of the Deal," Scholes commented on Trump’s negotiation style and highlighted a zero-sum mentality where one party benefits at another's expense. He also noted Canada’s attractive mineral resources for US energy independence, anticipating increased competition over these assets. Finally, he observed that discerning investors ("smart money") adjust their strategies based on market phases rather than blindly following trends.

Concluding the discussion, Scholes underscored Taiwan’s need to identify and leverage unique advantages in order to retain customers effectively.