Daily Commentary

MarketMinder’s View: There is obviously a lot of politics here, so please bear in mind we prefer no politician nor any party and assess developments for their potential economic and market implications only. And when we critique articles in this sphere, we focus on the market- and economy-related pieces of the argument. All the rest is sociology, which markets look past. So in that vein, we agree the Trump administration’s tariffs and trade threats on America’s commercial partners are an economic negative, hurting the imposer more than its targets—one reason US stocks underperformed non-US markets last year (which has continued year to date in 2026, per FactSet). Yet as this article also points out, “The power of the American economy makes it tough to dent, nevermind topple. The ‘sell America’ trade last year fizzled, and stock indexes reached new record highs just last week.” So while non-US stocks outperform, US stocks can still do well in absolute terms as reality keeps beating expectations. We have numerous problems, though, with the article’s alleged risks to America’s safe-haven status. First, the dollar isn’t going anywhere any time soon. Not because the US is forcing the rest of the world to use it, but because of its convenience as the most liquid currency to trade in, with the most abundant supply of reserve assets. Part and parcel of that: Treasurys—the world’s deepest bond market. Yes, America services a “high level of debt,” but that is because its credit is rock solid—which is why there is plenty of demand for it. Same with Corporate America’s debt for that matter. As for the claim high stock valuations signal a market especially vulnerable to these risks, high price-to-earnings ratios are a nothingburger since past prices aren’t predictive, especially the very backward-looking (and bizarrely inflation-adjusted) Shiller P/E. All these false fears show there is plenty of room for US stocks to keep running up the wall of worry.

MarketMinder’s View: Here is a useful look into China’s ongoing—and underappreciated—transition to a services-based economy. “Leaders have vowed to ‘invest in people’ by boosting spending on education, healthcare and social security—a signal of stronger support for families and a push to lift household spending power. Chinese households are channelling more spending into services—from elderly care to travel and entertainment—as demand for big-ticket goods plateaus. ... Services sales climbed 5.5% in 2025, higher than the 3.7% growth for goods. Per-capita services consumption reached 46.1% of total spending in 2025, up from 40.3% in 2014 when official data first became available. China’s household consumption is about 20 percentage points of GDP below the global average, while its investment share is roughly 20 points higher.” This suggests the shift toward a services-led consumption model is likely to take some time, especially when you consider the US’s two-thirds services share of consumer spending, which itself is 69% of GDP (per the US Bureau of Economic Analysis). We see a couple takeaways for investors from this. One, fears over China’s falling fixed asset investment (FAI)—negative for the first time last year (outside 2020’s pandemic lockdown)—are overblown. Not only did Chinese GDP keep growing overall (helped by services), but the FAI downturn looks deliberate. As the article notes, Beijing is trying to “wean itself off a traditional dependence on big-ticket investment and exports.” Two, services’ gaining share likely increases China’s economic resilience. Though services aren’t immune to business cycles, they are more sustainable drivers of economic growth than subsidized infrastructure and factory development, as the experience of most developed world economies demonstrates. Yet Chinese hard-landing fears persist, indicating to us steadier growth in the world’s second-largest economy has the power to surprise many on the upside.

MarketMinder’s View: With geopolitics raging the first few weeks of 2026, you might be strongly tempted to seek perceived safe havens in gold or crypto. But as this article points out, those are more volatile assets than stocks—likely with less long-term return potential. “My advice: Stay clear of pitches that use scare tactics, claiming that gold is the safest bet against inflation or an economic meltdown in the United States or Europe. Unlike investing in a stock that pays a dividend or in real estate yielding rent, gold has no inherent earnings power. And neither does crypto. To profit, you have to hope that someone else will come along and pay more than you did. This is referred to as the ‘greater fool theory.’ Also keep in mind that crypto’s volatility as a currency and as an investment makes it unsuitable for the average investor.” Note, as well, that scammers spy opportunity when emotions run high. “Schemes involving gold and other precious metals continue to top lists of financial products and practices that exploit investors. In one type of con, a fraudster will manipulate victims to cash out their investment accounts and purchase precious metals, such as gold bars, according to a report by the Financial Industry Regulatory Authority (Finra). ... In another scheme, promoters use high pressure to sell gold IRAs with massive markups and hidden fees. When it comes to crypto, the excitement about digital assets and the technology behind them creates the perfect environment for fraudsters who capitalize on investors fearing they will be left out of the next great thing.” It may be difficult, but in our view, a stiff upper lip and commitment to discipline are more useful for long-term investors than trying to find silver (gold?) bullet investment opportunities.