Investing
The End of The Beginning
Written by
Posted on April 16, 2025
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Investing
Everybody has a plan until they get punched in the face
What a privilege it was to watch Rory win: after the last month, I wonder whether that wonderful photo is a metaphor for how we all feel?
Mental exhaustion, combined with relief that we've muddled through.
Said Ben Bernanke in May 2022: ‘I think monetary policy is 98% talk and 2% action, and communication is a big part’.
Trump’s tariff delivery process has flipped that: it’s 90% action, with a minimum 10% flat tariff on cross talk.
Given the proposed reordering of the global trading system, the proposed reordering of global capital flows, and the imperative of not losing the bond market one would think sticking to a tight tariff script would be paramount - if only there were one.
Unlike the Fed, Trump has no dot plot.
And for markets that have been spoon fed (Fed) for twenty odd years, it is a tough transition to thinking for ourselves.
Yet this - thinking for ourselves - is the way it always used to be.
You bought assets on their merit, not based upon anticipated policy, and only with a considerable margin of safety because that ensured higher expected returns.
I am fully on board with more Main Street, less Wall Street and for that matter getting foreign partners to pay for their own defence.
I am fully on board with a less financialised economy, one in which via the mechanics of a lower US trade deficit must mean less recycling of global surpluses into dollar assets.
Starting in 2017, Xi sought to deleverage his economy (housing, property) to make his economy fit for purpose.
This oft repeated by Bessent ‘Wall Street will be fine, we are focussed on Main Street’ poses a challenge: is this a deliberate effort to de-financialise the US economy?
If Xi’s multi-year deleveraging of his economy is the proxy – then what the Trump administration is attempting isn’t going to be an overnight thing.
Nor, given the hyper-financialised nature of the US financial system, will it be easy.
Whilst the narrative surrounding last week’s treasury debacle is wildly inaccurate, I have never understood the net cumulative benefits to society offered by the casino culture of 0DTE, 2x and 3x levered ETFs and 2x and 3x levered single stocks ETF, and all sorts of trading platforms that make it as easy as possible for retail punters to play.
But how do you soft land a hyper-financialised economy in which US household net worth is approximately 8x personal disposable income?
And moreover, how to you soft land a bond market in which foreign capital underwrites approximately 30% of gross issuance, whilst simultaneously making it clear to all lenders you want your currency lower?
Last’s weeks important treasury auctions went well, but there’s still another $2 trillion plus to refinance in 2025.
Musk is now guiding FY 2026 DOGE savings lower – what was $1 trillion is now $150 billion - and who knows how much tariff revenue might be raised, because as of now it is impossible to model.
The consistent message large global pools of capital are hearing from Washington is
a) please sell our currency and
b) (I paraphrase) go away.
A jog or even a run from dollar assets?
No.
For a decade the world has been kind of 'auto-enrolled' in an overweight, unhedged US equity overweight.
The default global equity overweight for U.K. defined contribution pensions, for European private banks and wealth managers, and for Asian private banks: US equities.
Let's be clear: it worked.
But so great is the global savings overweight in dollar assets that even a tip toe out of the global dollar overweight can lead to disruptive market conditions.
It is time to use your imagination.
We are in a global competition for capital, one in which for ideological reasons the managers of the world’s reserve currency would like us to take our money home.
It will be a bumpy ride for us all, but in a global competition for capital, surplus countries – with large pools of domestic savings – are probably better off.
I am often asked ‘how is Europe going to fund the purchases of the ever increasing amount of bunds and joint-EU-bonds they are going to issue?’
The answer is staring us in the face: they will fund it out of the S&P500.
There are two recent Podcasts of mine in the public domain, to which you may wish to listen: with Grant Williams; and then another hosted by Ted Seides with the brilliant Louis-Vincent Gave and Marko Papic.
If this phase transition or regime shift - whatever it is, it is different - feels uncomfortable, don't worry, you're not alone.
I tip my hat to every one of my clients who, with great discipline and fortitude, deployed capital last Monday and last Tuesday.
We all want to be Warren Buffett, don’t we: until a Warren Buffett moment arrives.
Be like the 1%.
Not that 1% - the leveraged beta shills who confused brains with a bull market and are making total fools of themselves on this platform and elsewhere.
No, be like the 1% of market participants who are calm, confident, energised, focussed, knowledgeable, anticipatory and always in control.
And you know what that 1% (whom I've advised for twenty five years) were doing last Monday and Tuesday?
Operating as net liquidity providers, placing valuation-driven bids for specific assets well below market - and getting filled.
To be clear: these are not bets on Trump's reaction function.
Nor are they bets on uncertainty been resolved across weeks of difficult tariff negotiations, and perhaps two quarters of economic weakness.
And they are not bets on pivots, either.
If you are buying assets on their merits (intrinsic valuation - how very quaint), you can be a successful investor without being a perpetual forecaster.
In fact, one of the most liberating experiences for an investor is to be asked 'what's you're forecast of X?'
And to reply 'I don't have one'.
Let's be inspired by a great man's words, for I think they apply today:
Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.
If you want to be part of that 1%..
..until then, as ever, my aim is to be less wrong.
Mapping reality since 1992. Advising the world's most powerful pools of capital since 1999. Discover why the trust him: https://www.aitkenadvisors.com/contact
Written by
April 16, 2025
Investing
The Millennium Bridge as a metaphor for Trump
What a privilege it was to watch Rory win: after the last month, I wonder whether that wonderful photo is a metaphor for how we all feel?
Mental exhaustion, combined with relief that we've muddled through.
Said Ben Bernanke in May 2022: ‘I think monetary policy is 98% talk and 2% action, and communication is a big part’.
Trump’s tariff delivery process has flipped that: it’s 90% action, with a minimum 10% flat tariff on cross talk.
Given the proposed reordering of the global trading system, the proposed reordering of global capital flows, and the imperative of not losing the bond market one would think sticking to a tight tariff script would be paramount - if only there were one.
Unlike the Fed, Trump has no dot plot.
And for markets that have been spoon fed (Fed) for twenty odd years, it is a tough transition to thinking for ourselves.
Yet this - thinking for ourselves - is the way it always used to be.
You bought assets on their merit, not based upon anticipated policy, and only with a considerable margin of safety because that ensured higher expected returns.
I am fully on board with more Main Street, less Wall Street and for that matter getting foreign partners to pay for their own defence.
I am fully on board with a less financialised economy, one in which via the mechanics of a lower US trade deficit must mean less recycling of global surpluses into dollar assets.
Starting in 2017, Xi sought to deleverage his economy (housing, property) to make his economy fit for purpose.
This oft repeated by Bessent ‘Wall Street will be fine, we are focussed on Main Street’ poses a challenge: is this a deliberate effort to de-financialise the US economy?
If Xi’s multi-year deleveraging of his economy is the proxy – then what the Trump administration is attempting isn’t going to be an overnight thing.
Nor, given the hyper-financialised nature of the US financial system, will it be easy.
Whilst the narrative surrounding last week’s treasury debacle is wildly inaccurate, I have never understood the net cumulative benefits to society offered by the casino culture of 0DTE, 2x and 3x levered ETFs and 2x and 3x levered single stocks ETF, and all sorts of trading platforms that make it as easy as possible for retail punters to play.
But how do you soft land a hyper-financialised economy in which US household net worth is approximately 8x personal disposable income?
And moreover, how to you soft land a bond market in which foreign capital underwrites approximately 30% of gross issuance, whilst simultaneously making it clear to all lenders you want your currency lower?
Last’s weeks important treasury auctions went well, but there’s still another $2 trillion plus to refinance in 2025.
Musk is now guiding FY 2026 DOGE savings lower – what was $1 trillion is now $150 billion - and who knows how much tariff revenue might be raised, because as of now it is impossible to model.
The consistent message large global pools of capital are hearing from Washington is
a) please sell our currency and
b) (I paraphrase) go away.
A jog or even a run from dollar assets?
No.
For a decade the world has been kind of 'auto-enrolled' in an overweight, unhedged US equity overweight.
The default global equity overweight for U.K. defined contribution pensions, for European private banks and wealth managers, and for Asian private banks: US equities.
Let's be clear: it worked.
But so great is the global savings overweight in dollar assets that even a tip toe out of the global dollar overweight can lead to disruptive market conditions.
It is time to use your imagination.
We are in a global competition for capital, one in which for ideological reasons the managers of the world’s reserve currency would like us to take our money home.
It will be a bumpy ride for us all, but in a global competition for capital, surplus countries – with large pools of domestic savings – are probably better off.
I am often asked ‘how is Europe going to fund the purchases of the ever increasing amount of bunds and joint-EU-bonds they are going to issue?’
The answer is staring us in the face: they will fund it out of the S&P500.
There are two recent Podcasts of mine in the public domain, to which you may wish to listen: with Grant Williams; and then another hosted by Ted Seides with the brilliant Louis-Vincent Gave and Marko Papic.
If this phase transition or regime shift - whatever it is, it is different - feels uncomfortable, don't worry, you're not alone.
I tip my hat to every one of my clients who, with great discipline and fortitude, deployed capital last Monday and last Tuesday.
We all want to be Warren Buffett, don’t we: until a Warren Buffett moment arrives.
Be like the 1%.
Not that 1% - the leveraged beta shills who confused brains with a bull market and are making total fools of themselves on this platform and elsewhere.
No, be like the 1% of market participants who are calm, confident, energised, focussed, knowledgeable, anticipatory and always in control.
And you know what that 1% (whom I've advised for twenty five years) were doing last Monday and Tuesday?
Operating as net liquidity providers, placing valuation-driven bids for specific assets well below market - and getting filled.
To be clear: these are not bets on Trump's reaction function.
Nor are they bets on uncertainty been resolved across weeks of difficult tariff negotiations, and perhaps two quarters of economic weakness.
And they are not bets on pivots, either.
If you are buying assets on their merits (intrinsic valuation - how very quaint), you can be a successful investor without being a perpetual forecaster.
In fact, one of the most liberating experiences for an investor is to be asked 'what's you're forecast of X?'
And to reply 'I don't have one'.
Let's be inspired by a great man's words, for I think they apply today:
Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.
If you want to be part of that 1%..
..until then, as ever, my aim is to be less wrong.
Mapping reality since 1992. Advising the world's most powerful pools of capital since 1999. Discover why the trust him: https://www.aitkenadvisors.com/contact
Written by
April 16, 2025
Investing
What was that all about?
What a privilege it was to watch Rory win: after the last month, I wonder whether that wonderful photo is a metaphor for how we all feel?
Mental exhaustion, combined with relief that we've muddled through.
Said Ben Bernanke in May 2022: ‘I think monetary policy is 98% talk and 2% action, and communication is a big part’.
Trump’s tariff delivery process has flipped that: it’s 90% action, with a minimum 10% flat tariff on cross talk.
Given the proposed reordering of the global trading system, the proposed reordering of global capital flows, and the imperative of not losing the bond market one would think sticking to a tight tariff script would be paramount - if only there were one.
Unlike the Fed, Trump has no dot plot.
And for markets that have been spoon fed (Fed) for twenty odd years, it is a tough transition to thinking for ourselves.
Yet this - thinking for ourselves - is the way it always used to be.
You bought assets on their merit, not based upon anticipated policy, and only with a considerable margin of safety because that ensured higher expected returns.
I am fully on board with more Main Street, less Wall Street and for that matter getting foreign partners to pay for their own defence.
I am fully on board with a less financialised economy, one in which via the mechanics of a lower US trade deficit must mean less recycling of global surpluses into dollar assets.
Starting in 2017, Xi sought to deleverage his economy (housing, property) to make his economy fit for purpose.
This oft repeated by Bessent ‘Wall Street will be fine, we are focussed on Main Street’ poses a challenge: is this a deliberate effort to de-financialise the US economy?
If Xi’s multi-year deleveraging of his economy is the proxy – then what the Trump administration is attempting isn’t going to be an overnight thing.
Nor, given the hyper-financialised nature of the US financial system, will it be easy.
Whilst the narrative surrounding last week’s treasury debacle is wildly inaccurate, I have never understood the net cumulative benefits to society offered by the casino culture of 0DTE, 2x and 3x levered ETFs and 2x and 3x levered single stocks ETF, and all sorts of trading platforms that make it as easy as possible for retail punters to play.
But how do you soft land a hyper-financialised economy in which US household net worth is approximately 8x personal disposable income?
And moreover, how to you soft land a bond market in which foreign capital underwrites approximately 30% of gross issuance, whilst simultaneously making it clear to all lenders you want your currency lower?
Last’s weeks important treasury auctions went well, but there’s still another $2 trillion plus to refinance in 2025.
Musk is now guiding FY 2026 DOGE savings lower – what was $1 trillion is now $150 billion - and who knows how much tariff revenue might be raised, because as of now it is impossible to model.
The consistent message large global pools of capital are hearing from Washington is
a) please sell our currency and
b) (I paraphrase) go away.
A jog or even a run from dollar assets?
No.
For a decade the world has been kind of 'auto-enrolled' in an overweight, unhedged US equity overweight.
The default global equity overweight for U.K. defined contribution pensions, for European private banks and wealth managers, and for Asian private banks: US equities.
Let's be clear: it worked.
But so great is the global savings overweight in dollar assets that even a tip toe out of the global dollar overweight can lead to disruptive market conditions.
It is time to use your imagination.
We are in a global competition for capital, one in which for ideological reasons the managers of the world’s reserve currency would like us to take our money home.
It will be a bumpy ride for us all, but in a global competition for capital, surplus countries – with large pools of domestic savings – are probably better off.
I am often asked ‘how is Europe going to fund the purchases of the ever increasing amount of bunds and joint-EU-bonds they are going to issue?’
The answer is staring us in the face: they will fund it out of the S&P500.
There are two recent Podcasts of mine in the public domain, to which you may wish to listen: with Grant Williams; and then another hosted by Ted Seides with the brilliant Louis-Vincent Gave and Marko Papic.
If this phase transition or regime shift - whatever it is, it is different - feels uncomfortable, don't worry, you're not alone.
I tip my hat to every one of my clients who, with great discipline and fortitude, deployed capital last Monday and last Tuesday.
We all want to be Warren Buffett, don’t we: until a Warren Buffett moment arrives.
Be like the 1%.
Not that 1% - the leveraged beta shills who confused brains with a bull market and are making total fools of themselves on this platform and elsewhere.
No, be like the 1% of market participants who are calm, confident, energised, focussed, knowledgeable, anticipatory and always in control.
And you know what that 1% (whom I've advised for twenty five years) were doing last Monday and Tuesday?
Operating as net liquidity providers, placing valuation-driven bids for specific assets well below market - and getting filled.
To be clear: these are not bets on Trump's reaction function.
Nor are they bets on uncertainty been resolved across weeks of difficult tariff negotiations, and perhaps two quarters of economic weakness.
And they are not bets on pivots, either.
If you are buying assets on their merits (intrinsic valuation - how very quaint), you can be a successful investor without being a perpetual forecaster.
In fact, one of the most liberating experiences for an investor is to be asked 'what's you're forecast of X?'
And to reply 'I don't have one'.
Let's be inspired by a great man's words, for I think they apply today:
Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.
If you want to be part of that 1%..
..until then, as ever, my aim is to be less wrong.
Mapping reality since 1992. Advising the world's most powerful pools of capital since 1999. Discover why the trust him: https://www.aitkenadvisors.com/contact
Written by
April 16, 2025
Investing
What might investors learn from THAT photo?
What a privilege it was to watch Rory win: after the last month, I wonder whether that wonderful photo is a metaphor for how we all feel?
Mental exhaustion, combined with relief that we've muddled through.
Said Ben Bernanke in May 2022: ‘I think monetary policy is 98% talk and 2% action, and communication is a big part’.
Trump’s tariff delivery process has flipped that: it’s 90% action, with a minimum 10% flat tariff on cross talk.
Given the proposed reordering of the global trading system, the proposed reordering of global capital flows, and the imperative of not losing the bond market one would think sticking to a tight tariff script would be paramount - if only there were one.
Unlike the Fed, Trump has no dot plot.
And for markets that have been spoon fed (Fed) for twenty odd years, it is a tough transition to thinking for ourselves.
Yet this - thinking for ourselves - is the way it always used to be.
You bought assets on their merit, not based upon anticipated policy, and only with a considerable margin of safety because that ensured higher expected returns.
I am fully on board with more Main Street, less Wall Street and for that matter getting foreign partners to pay for their own defence.
I am fully on board with a less financialised economy, one in which via the mechanics of a lower US trade deficit must mean less recycling of global surpluses into dollar assets.
Starting in 2017, Xi sought to deleverage his economy (housing, property) to make his economy fit for purpose.
This oft repeated by Bessent ‘Wall Street will be fine, we are focussed on Main Street’ poses a challenge: is this a deliberate effort to de-financialise the US economy?
If Xi’s multi-year deleveraging of his economy is the proxy – then what the Trump administration is attempting isn’t going to be an overnight thing.
Nor, given the hyper-financialised nature of the US financial system, will it be easy.
Whilst the narrative surrounding last week’s treasury debacle is wildly inaccurate, I have never understood the net cumulative benefits to society offered by the casino culture of 0DTE, 2x and 3x levered ETFs and 2x and 3x levered single stocks ETF, and all sorts of trading platforms that make it as easy as possible for retail punters to play.
But how do you soft land a hyper-financialised economy in which US household net worth is approximately 8x personal disposable income?
And moreover, how to you soft land a bond market in which foreign capital underwrites approximately 30% of gross issuance, whilst simultaneously making it clear to all lenders you want your currency lower?
Last’s weeks important treasury auctions went well, but there’s still another $2 trillion plus to refinance in 2025.
Musk is now guiding FY 2026 DOGE savings lower – what was $1 trillion is now $150 billion - and who knows how much tariff revenue might be raised, because as of now it is impossible to model.
The consistent message large global pools of capital are hearing from Washington is
a) please sell our currency and
b) (I paraphrase) go away.
A jog or even a run from dollar assets?
No.
For a decade the world has been kind of 'auto-enrolled' in an overweight, unhedged US equity overweight.
The default global equity overweight for U.K. defined contribution pensions, for European private banks and wealth managers, and for Asian private banks: US equities.
Let's be clear: it worked.
But so great is the global savings overweight in dollar assets that even a tip toe out of the global dollar overweight can lead to disruptive market conditions.
It is time to use your imagination.
We are in a global competition for capital, one in which for ideological reasons the managers of the world’s reserve currency would like us to take our money home.
It will be a bumpy ride for us all, but in a global competition for capital, surplus countries – with large pools of domestic savings – are probably better off.
I am often asked ‘how is Europe going to fund the purchases of the ever increasing amount of bunds and joint-EU-bonds they are going to issue?’
The answer is staring us in the face: they will fund it out of the S&P500.
There are two recent Podcasts of mine in the public domain, to which you may wish to listen: with Grant Williams; and then another hosted by Ted Seides with the brilliant Louis-Vincent Gave and Marko Papic.
If this phase transition or regime shift - whatever it is, it is different - feels uncomfortable, don't worry, you're not alone.
I tip my hat to every one of my clients who, with great discipline and fortitude, deployed capital last Monday and last Tuesday.
We all want to be Warren Buffett, don’t we: until a Warren Buffett moment arrives.
Be like the 1%.
Not that 1% - the leveraged beta shills who confused brains with a bull market and are making total fools of themselves on this platform and elsewhere.
No, be like the 1% of market participants who are calm, confident, energised, focussed, knowledgeable, anticipatory and always in control.
And you know what that 1% (whom I've advised for twenty five years) were doing last Monday and Tuesday?
Operating as net liquidity providers, placing valuation-driven bids for specific assets well below market - and getting filled.
To be clear: these are not bets on Trump's reaction function.
Nor are they bets on uncertainty been resolved across weeks of difficult tariff negotiations, and perhaps two quarters of economic weakness.
And they are not bets on pivots, either.
If you are buying assets on their merits (intrinsic valuation - how very quaint), you can be a successful investor without being a perpetual forecaster.
In fact, one of the most liberating experiences for an investor is to be asked 'what's you're forecast of X?'
And to reply 'I don't have one'.
Let's be inspired by a great man's words, for I think they apply today:
Now this is not the end. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.
If you want to be part of that 1%..
..until then, as ever, my aim is to be less wrong.
Mapping reality since 1992. Advising the world's most powerful pools of capital since 1999. Discover why the trust him: https://www.aitkenadvisors.com/contact
Written by
April 16, 2025