Stock Market Investors

[…] The Trump administration believes that it must act swiftly and take a wrecking ball to the way international trade has been organized. What they are attacking is David Ricardo’s economic theory that everyone benefits by making what each country makes better than the other countries. Under normal circumstances, the U.S. has been happy to let numerous other countries prosper under very generous trading rules. Post-COVID-19, the current presidential administration believes that the prior system is unsustainable because it has been massively subsidized by U.S. deficit spending. The interest expense and future principal payments look ominous. […]

Over the last 15 years, the United States economy and financial system have been built on the back of a stock market ownership society. The premise is that average to above-average income households will prosper in the stock market and that prosperity would benefit those who don’t own common stocks themselves. This was a similar premise to the one used by President Reagan to produce prosperity in the 1980s, which was called “trickle-down economics.” In theory, President Trump’s tariffs are intended to benefit average to below-average income American households by onshoring jobs and factories. Someone might call this “trickle-up economics.” […]

We want to ensure our investors know that we are standing side-by-side with them, as the stock market can do fairly illogical things from time to time. We’d like to discuss our three worst-performing securities in the US portfolio to help our investors understand why we are sitting on our hands and allowing our discipline to proceed. We are pounding the table at the opportunity within our grasp and wish to assure investors that we like what these circumstances are giving us. We believe they will guide us toward the successful outcomes that we have seen time and time again. […]