The bond yield saved the day, the week, and the economy.
As of Wednesday morning the idiot was holding firm on his 1930s tariffs plan. And how well did they work back then ? Don’t get depressed (hint) if you don’t know the answer.
But then investors began fleeing the safety of the US by not buying the 10 year treasury bond. The price fell and the yield soared over 4%. There was no more faith in the US. The Treasury and Commerce Secretaries met with the idiot in the idiot’s office and explained it to him in simple terms. When investors lose faith in treasury bonds - traditionally the safest place in the word to store money - the game is over. We go from recession to depression and the economy is wrecked.
Lo and behold within the hour the idiot reversed course and the markers rallied over 9%. Less than half of what they have lost. But still a record breaking rally. Which leads us to this warning. The biggest rallies occur during bear markets. So be careful. We are not out of the woods.
In the final analysis we are in a scenario where the markets are reacting to political news and not economic issues. Unlike the credit collapse of 2007-08 there is no fundamental weakness in the economy other than the idiot trying to lead it. The economy is strong. Our president is weak. So we are hostage to his whims.
But what will not go away is people need iPhones. And the AI revolution is here. Apple is a great stock. And an amazing buy under 200. Nvidia is an amazing company with a five year moat around its AI leading chips. It was the buy of a lifetime under 100 and it’s still great value under 120-130 as it’s a 200 plus stock at the end of the year if the idiot can stay out of the way. Amazon is the strongest retailer in the world. It can navigate the tariff issue better than any other retailer. It’s a great buy under 200.
So there is our take.
Bonds saved us.
For now.
8 comments:
Yes and Howard Lutnick is a moron too - the commerce secretary - started biggest bond shop in America - Cantor Fitzgerald. The situation today is nothing like the 1930s. A country should not charge us $ to get our goods in and we don’t charge them. That’s idiotic.
RUMPOLE … your investment advice is so brilliant and fact based. You understand the global economy and markets. Please continue to navigate us toward wealth.
Bless you Sir.
Rump you haven’t been the same since the Herald acknowledged this blog as a “judicial blog”.
See comment one.
Lutnick is far from a moron. After loosing 658 employees and the damage and chaos 9/11 caused, he managed to not only rebuild but expanded its operations globally. As of 2025, the firm operates in over 60 offices across 20 countries and employs more than 12,500 people .
Is there a lack of engagement in this blog or are comments not being posted?
There are known justifications for tariffs. And critics should not launch ad hominem attacks to bolster their position. The debate goes to ultimate benefit for the US. I'd like to hear prominent experts in the field discuss pertinent economic theory.
Neither- as a few insiders know, not only do I write the post but I write most of the comments. When it’s slow it means I’m busy with other stuff.
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