Wednesday, November 9, 2016

Trump Won. Now What?

First, several self-evident facts (you can search internet if you don't believe me).

During democratic presidencies stocks grow much better than during republican.

Any attepmt to restrict imports into US under any pretext will cause trade wars, which would really cost US hundreds of thousands, if not millions, of jobs, and a lot of investment income (or cause investment loss).

Current low interest rate environment is not a fluke. It's a consequence of demographics in the developed world. I don't see how this can be changed by any government. Any attempt to significantly raise rates is going to be disastous.

Changes in strategy

My current cash position is around 25%. Going to increase it to around 30%

I have too much money invested in conventional companies. Now it's mostly dead money. Most of new investment is going to networked economy. The only exception is defence sector. GOP, in their very non-corrupt wisdom, is going to throw a lot of money there (there is a consensus between Trump and other elected GOP members). Going to sell rallies. First candidates are conventional companies with significant exports.

Because I'm close to retirement age, I already moved a lot of money into fixed income CEFs. I am going to increase that portion. All talks about bond crush is huge BS. Yes, effective yields on bonds are going to go down and that requires some careful management.

Significant portion of money should go abroad, one way or another. So far, I used ADRs, looking for other opportunities.