In Reply to: Dow is up 16% since Chump took office but the rest posted by Bruinfan4ever on February 22, 2026 at 08:19:49
These are all 2025 numbers.
Prior to 2024, the U.S. stock market significantly outperformed the rest of the world. In 2025, however, non-U.S. international index funds are up 32%. That is the number we should be comparing ourselves to.
If you look at the “Magnificent 7” or “Magnificent 10” (the 7 or 10 largest companies in the S&P 500), they are performing very well:
The Mag 7 are up 33% in 2025.
The Mag 10 are up 35% in 2025.
Mid-cap stocks are up only 6.5%.
The Mag 10 make up roughly one-third of the S&P 500, which is up 18% overall. However, if you equally weight the top 500 companies, the index is up only 9.34%.
This suggests that the largest companies are performing on par with international markets, while the broader U.S. market is relatively stagnant. Gains are highly concentrated at the top.
It has been relatively easy to make money during the Trump era if you’ve followed the signals closely.
Pre-pandemic, I sold my car and waited for the market to decline.
Before the tariffs, I sold one-third of my stock holdings and exited my S&P positions around the same time Berkshire Hathaway did. I shifted from mid-caps and the broader S&P into the Mag 10 because it appeared that access to Trump — and therefore influence — was concentrated among the wealthiest CEOs.
After tariffs were announced, I noticed Treasury prices rising while equities were falling. That suggested foreign capital was leaving U.S. markets. In response, I bought European and German ETFs, European military aerospace ETFs, and Korean defense ETFs. Those performed well as NATO countries increased military spending.
Right now, we are in a concerning position. The U.S. market appears expensive. It continues rising largely on momentum rather than broad-based earnings strength.
At this point, my AI exposure is concentrated only in companies with strong cash flow and/or existing AI monetization: Amazon, Microsoft, Meta, and Google. I am also betting on interface layers for the eventual AI winner — companies like Apple and Uber.
I expect lower interest rates after June, driven by a slowing economy, reduced tariffs, and rising unemployment. Because of that, I am gradually moving capital into REITs.
I made small speculative bets on Bitcoin and software stocks, but I bought them midway way down rather than the bottom.
The key macro question is this: If the U.S. economy weakens, does the rest of the world fall with it, or have tariffs and geopolitical shifts reduced how tightly allied economies are linked to the U.S.? Right now I'm biasing money towards foreign countries since foreign countries have re-routed supply chain and their customer base.
Last year I made large bets on Trump “TACOing” (backing off aggressive positions) before his first major reversal and personal grift from the largest companies. It paid off well.
Now that markets widely expect him to reverse course under pressure, I’m unsure whether any pricing inefficiency remains at current valuations in the stock market.
At this point I'm leaning towards foreign stock investments ETF/index funds and infrastructure/index domestic and foreign real estate (REITS).