Well, here we go!  As I write this, we are down to the home stretch of the 2024 election. In my opinion, this whole thing can’t end soon enough, but that’s not what this newsletter is about.

What I want to discuss here, for clients of Hamilton Wealth Management and others, is how we should be considering our investment strategy in these politically insane times. Does it matter TO YOUR INVESTMENTS who winds up in the white house for the next four years? Should we make changes to our investment models based on who we think is going to win?

Well, yeah, it does matter, but maybe not how you’d think when considering each candidate’s positions. As I have said many times, what’s good for the country as a whole may or may NOT be good for certain investments. 

For example, is an increasing national debt and annual deficit good for the country? I sure don’t think so. But ask yourself this: Has deficit spending been a boost for some of the investments many of us own? I’d say, yes, some of that spending winds up in asset prices, so if you own many types of assets, stocks included, our debt has played a role in increasing the value of some of our investments.  I think this has been a big force behind the unfortunate divide in our country between the “Haves” and “Have Nots”.  

Again, huge deficits and debt… good for the future of our county? Our young people? I’d say “no”, likely you’d agree. But in a strange twist of unintended (maybe) consequences, I think this irresponsible spending has benefited many who own assets, homes, stocks, etc. And that’s many of you, our clients and friends. So, while maybe you don’t approve of this overspending (I sure don’t), your portfolio may have benefitted from it. 

Now, once we see who wins, then see how various economic policies do or don’t get implemented, then yeah, we may tweak portfolios based on what actually is happening. For example, capital gains tax rate increases might make stocks a bit less attractive on margin. Runaway deficit spending might make treasuries less attractive, as more are issued to cover the spending and supply/demand balances change. 

There are many examples of things we’d be watching for in actual policy implementation, but rarely would we consider political promises in our allocations. I think we all know why this is the case!

So, as this tireless election season winds to an end, I just wanted to remind you all to try and separate your politics from your investment management. And yes, this is very hard to do for many, me included. However, as a disciplined, fiduciary investment manager, this is what I must do in managing our clients’ portfolios. Investments don’t care about your politics, they don’t care about equality, they don’t care about right vs. left, and they don’t care about the long-term future of our country. 

Investments care about money, that’s all. Yeah, that’s cold and heartless sounding.  But it’s also reality. You can like reality or not like it, but it is what it is, as they say. So, we won’t take our eyes off the ball, even in this crazy political world! 

Go Vote!!!!! 

Tom