It’s Bad, and It’s Going to Be All Right

It’s Bad, and It’s Going to Be All Right

I’m sitting here trying to finish up my investment letter to clients that will be in mailboxes next week. I hope you read it. There’s a lot to discuss. 

But I want to get the main message out to you now in hopes this week’s historic events (feel free to replace my weak and diplomatic historic with your own adjective or expletive) — will not take an unnecessary toll on your weekend. 

Here it is: As far as investments and what’s going on today, I’m still sleeping just fine. I think you should, too. 

The roadmap laid out in previous letters has been followed. Stock levels are low, and what we have is outperforming overall. Adding more bonds and precious metals have also been a plus. 

Those in our All-Stock strategy have also fared relatively well. P&C insurers instead of Big Tech have worked out great. Those portfolios have up to 20% cash currently. 

That’s the good-ish news. The bad news is America is playing a dangerous game. The new tariff regime announced Wednesday is maybe the biggest (and most dangerous) strategy change and policy gamble ever.

And the most dishonest one. Clue: the Tariffs Charged to the U.S.A. column has nothing to do with existing tariff rates. (More in the letter next week.) Yet, these numbers are the basis for levying tariffs dwarfing those of Smoot-Hawley, the tariff act that was a principal cause of The Great Depression.

I’ll sleep fine tonight. In the context of the long term, disaster makes for the best opportunities. The plan is to parlay timely fear with timely greed and generational buying opportunities. Easier said than done, of course. And, you must survive first to have any shot.

We won’t forget that part. 

About the Author

Neil Rose, CFA, is the founder and CEO of Regency Capital Management.

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