Our monthly newsletter:
“In economics, things take longer to happen than you think they will, and then they happen faster than you thought they could.”
― Rudiger Dornbusch, Economist
At the beginning of last year, I wrote that I had never been more fearful (financially speaking). That feeling still holds. While the announcement of “liberation day” tariffs sparked a brief market rout early in the year, the subsequent TACO (Trump Always Chickens Out) trade took hold, leading the market to new heights along with a still soaring technology sector.
There is scant evidence to suggest that we are not in a financial bubble mirroring that of the Dot Com bubble at the turn of the millennium. Just because a technology will change the future (like AI now and the Internet before it), that does not mean the companies promoting it are a good long-term investment. The best way to navigate market euphoria and deteriorating underlying economic conditions is to not play the timing game at all. I do not know when the current bubble will burst, just that it will.
As such, Hughes Capital Management will continue with our holding strategy, waiting for opportunities to eventually emerge. The market still presents far more risk than reward.
As always, if you have any questions about investing or your existing portfolio, please don’t hesitate to ask. While my management isn’t free, my advice is.
Thank you for your continued trust and best wishes in the coming year,
Devin