PORTFOLIO UPDATES—IS THE WAR OVER?
Dear members, it’s safe(r) to re-enter the markets now. Stocks, bonds, currencies, metals. That means that you can consider going back into the standard positions in the Model Portfolios.
I’ve opened this post up for everyone, by the way, so that everyone has a little bit of guidance.
Those of you who bought into the last two positions we discussed, energy futures and commodities, did very well: you made between 10-20% in a few weeks. These were risky bets, and I hope they helped teach you how to invest well. These positions have now run their course for the time being.
It’s possible that Trump will double cross Iran at any point in the next two weeks, and try to seize control of its oil. It’s possible, too, that the negotiations will fail. In either case, markets will begin to decline sharply again across the world. Please be watchful of all this.
Over the next day or two, markets are likely to skyrocket. Then reality will probably set in. For example, one of the world’s major shipping companies has already said that it won’t magically whisk ships through the Strait of Hormuz just yet, because the risk is still too great. See the lesson: the risks are still grave, very much so, for business as usual to fully resume. So there’s likely to be a great deal of volatility to come.
(Meanwhile, of course, Iran has said it will charge a “toll,” and that, too, will place a damper on any hopes of a quick recovery to normalcy.)
If you’d like to stay as safe as possible, remain cashed out. There’s no great need to chase returns which are still quite risky for many people, especially retirees.
Please understand that a “ceasefire” especially in the hands of a figure like Trump, who can’t be trusted to begin with, is not “the end” of the war. That remains to be seen.
If you’d like to be a little more aggressive, it’s OK to re-enter the markets, but keep an eye on things, and if your nerves twitch, my advice is: exit.
There are always ways to make money. That’s what markets are for. In scenarios like this, there is a great deal to be made, and I’ll give you some counsel about that in the next few days.
Love,
Umair (and Snowy!)
Many thanks. Yet in current circumstances how does any investment *anywhere* make sense as the world economy is still hostage to fossil fuel, and newly subservient to Iran’s control of the Strait of Hormuz? At 75, I remain cashed out and extremely concerned about oil supply inflation. Also as a former financial regulator in the U.S., I remain terrified that Trump appointees charged with overseeing banks, Wall Street, and credit markets have zero interest in effective risk management (or even risk identification). I don’t believe the U.S. will get through 3 more years of Trump without a financial cataclysm in U.S. markets.
Thank you!