Cast Your Mind Back
As we approach the end of Q3, my mind wandered back to earlier in the year, when Trump’s tariffs were apparently about to shut the world down, if you believed the experts and the wise financial journalists.
Can you remember the general sentiment? Here is a quick refresher:
- “Global markets in turmoil as Trump tariffs wipe $2.5tn off stocks” — The Guardian, 3 April 2025
- “Dow Tumbles 2,200 Points, Bonds Rally After China Retaliates Against Trump Tariffs” — WSJ, 4 April 2025
- “S&P 500 loses $5 trillion in two days in Trump tariff selloff” — Reuters, 4 April 2025
- “Wall Street selloff caps brutal week for markets as Trump tariffs rattle investors” — The Guardian, 4 April 2025
- “Tariff-whipped Wall Street wonders: will Trump blink?” — Reuters, 8 April 2025
And as of this morning, here is where things actually stand year to date:
- FTSE 100: 9,260.64 — up 12.11%
- FTSE All-Share: 5,009.87 — up 11.10%
- S&P 500: 6,604.72 — up 12.29%
- Dow Jones: 45,947.32 — up 8.00%
- Nasdaq Composite: 22,384.70 — up 15.92%
But How?
Because not too long ago, those same experts at the Wall Street Journal, the Guardian, and Reuters were telling us, or certainly insinuating, that the world was caving in.
They may not have said that literally, but the sensationalist way they deliver information is, I believe, often quite wrong.
And it matters.
Because the Mr and Mrs Smiths of this world, with their pension pots and ISAs, are sent into mass panic. They call their insurance company, which cannot give them advice anymore, only information, and they request everything be sold while it is falling off a cliff.
I know that happens, because most recently I rescued a chap called Stan. He had already pulled the trigger on what I can only describe as financial suicide. Thankfully, I was able to get Aviva to reverse his instruction just in time.
True story. And not the only one I have stepped in to save over the years.
The Lunatic Asylum
The journos are obsessed with the stock market, and their big screens, with millions of coloured red and green digits flashing right to left at 30 mph.
It is basically a lunatic asylum fuelled by adrenaline, fear and greed.
Just look at some of their greatest hits from the last 18 months:
- “Markets enter correction…”
- “Recession fears grip investors…”
- “AI bubble about to burst…”
And yet here we are, still pushing ahead.
What to Remember
We do not invite anyone we look after to gamble in stock or bond markets.
As my late Dad always said, the only way to win at gambling is to play snap with a man with a st… st… stutter.
Always remember:
- We invest in the great companies of the world. Developed, emerging, large, small, growth and value companies. The markets can look insane, but good businesses do not.
- It is a package deal. You do not get the advance without enduring the declines. The two are inseparable. The permanent advance over the last century shows global equities compounded at around 10% per annum. The temporary declines show markets have fallen by roughly a third every five or so years.
- My job is to keep you in your chair when everyone else is running around panicking. That is, all things considered, the most important part of my role for those we support.
Yes, the portfolio structure, asset allocation, bond and equity weightings, and global diversification across developed and emerging markets are all vital. But keeping everyone on the ark is, by far, the biggest part of the job. No one I support has tossed their portfolio overboard in the last 20 years.
What Comes Next
The next drops will come. I cannot tell you when, but I can tell you they will pass. They always do.
When Trump’s tariffs rattled markets, the headlines made it sound like the end of days. The reality is simple. Stay seated, stay invested, keep accumulating whilst you can, and let the great companies of the world do the heavy lifting.
If you would like to talk through your own position, we are always happy to have that conversation.
Contact us today or call 0345 200 4041 to arrange a free consultation.
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