Weekly Market Pulse: I Don't Know

2025-02-03 10:35:00 ET

Summary

• The world’s products are exchanged as never before, and with increasing transportation facilities come increasing knowledge and larger trade.
• Our goods trade balance worsened from -$103.5 billion in November to -$122.1 billion in December as imports surged 3.9% while exports fell 4.5%.
• The dollar was up 0.9% last week, a pretty steady rise throughout the week as the tariffs grew closer.

By the time you read this, markets around the world will be reacting to the Trump administration’s imposition of tariffs on Canada and Mexico and additional tariffs on China. I don’t know what exactly that reaction will be although it seems unlikely to be positive, at least initially. Regardless of the market reaction, investors need to be careful not to let their feelings about President Trump - positive or negative - inform their investment decision-making. Our job is to interpret the market reaction and try to determine whether portfolio changes are necessary and if so, when and how they should be implemented. You’ll notice that the preceding statement says nothing about trying to guess what the Trump administration will do next, or what policy you or I think might be better. We are not politicians or policymakers and there is no point in wasting our time on things over which we have no influence or control. We have to invest in the world we have, not the one we want....

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