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Salvatore Norge's avatar

I've been in the game long enough to know how to win; gather information from various sources over multiple days/weeks, then make my own decision based on my God-given intuition, which has served me very well. Earlier this week I basically went 100% MSTU at $4.52 per share 😉

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Mack BT's avatar

Love the depth of your work. Always an interesting take within your posts.

While I generally agree with you, I think there is a tail risk unlike any we have ever experienced in our investment careers- even me being a lot older.

This administration seems to believe that complete reset of the US economy is warranted here. Goodbye to Bretton Woods- you could argue largely responsible the gift that we call American Exceptionalism. Hello Mar a Lago Accord, where we take that exceptionalism and throw it at the rest of the world in defiant anger.

What will the results of terming out to 100 years the holders of US treasuries in countries in exchange for protection? Aside from sounding like organized crime, what does that do to the perceived ‘risk-free’ asset, the Trust that has become such a large part of our country’s comparative advantage.

I use this as one example of many. There are massive structural changes being debated. This isn’t Volcker raising rates to crush inflation. If any or all of these policies are implemented, they will likely cause massive reallocations of global capital. First, our are financial markets structurally sound enough to withstand such paradigm shifts? And, second, wholesale changes to global capital structures will dramatically alter the winners and losers that we have become accustomed to in certain markets.

Just saying, we may need to use different lenses for analysis. It’s telling that the median stock is -18%. Reflexivity often kicks in after such losses. And if we cannot rely on the traditional tools for arresting a market decline, this time really could be different!

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