Daily Archives: 19 March 2025

Overreaction

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This is one such. The headline and subhead say it:

The Days of Set-and-Forget Investing Just Ended for Many Americans
President Trump’s economic policies are sending investors out of US stocks and into cash, bonds, gold and European defense stocks

The newswriters illustrate their claim with this anecdote:

For years, Yoram Ariely hadn’t touched most of his investments, preferring to ride the stock market’s ups and downs. Last Tuesday, he decided he had enough.
The 82-year-old unloaded almost half of his stock investments, fearful of the effects of President Trump’s economic agenda, and tariffs in particular. He may get rid of more still.
“The decisions are changing daily,” said Ariely, a retired business owner in Longboat Key, FL.

Therein lies the problem with this sort of reaction. Buy and hold—set and forget in newswriters’ lexicon—has always been a fine, if not flashy, way to build wealth when it’s done from a young age and continued through retirement/geezerdom. That includes riding through the ups and downs, including corrections and bear markets. Some investors, who change the stocks (and/or bonds, real estate, gold and silver with their reputation as inflation hedges, etc) occasionally (over weeks to months), will do better and others worse than buy and holders. Some traders, who change their vehicles on a more frequent basis, down through daily trades, also will do better and others worse. Slow but steady produces, over the long term, steady and favorable results, if without the flash and the heady rush.

And that’s the key: over the long term, which takes lots of patience and an emotional willingness to ride through the inevitable downturns, corrections, and bear markets, even more to add to holdings during those down turns. Worries about the disruptions and dislocations associated with President Donald Trump’s (R) economic and political moves are overblown in the sense that these are just another of those inevitable disruptions. Buy and hold remains a viable, middle of the road wealth building technique.

On the other hand, buy and hold has never been the right path for those of an age—those retired geezers—for whom there’s little time left in their lives in which, and reduced steady income with which, to recover from a sharp or relatively deep (or deep) market downturn. For those folks, preserving the wealth, the capital, that they have accumulated becomes more important than continuing to try to increase their wealth. The latter entails more risk than is optimal for those with shortening remaining life spans and reduced regular income.

Trump’s moves are just another of the disruptions inevitable in an investing environment; they present no reason for anyone to change their investing style.

Moral Bankruptcy of Some University Managers

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The Trump administration is investigating quite a number of universities over allegations of rampant antisemitism and discrimination generally infesting them. The managers of those institutions are upset, and with their upset, they’re demonstrating their blatant moral bankruptcy.

Administrators, professors and prospective students at major universities across the country are expressing concerns about the future of higher education as the Trump administration restricts funding for DEI and investigates schools for charges of antisemitism.
School officials “are in an impossible situation with facing the unknown as to what may happen down the road,” Ohio University alumni association board member Kim Barlag told The Wall Street Journal.

There’s nothing at all impossible about doing a right thing, nothing at all impossible about moving against the bigotry rampant at those institutions. Many of those institutions’ managers are just sulking and doing the academic equivalent of holding their breath until they turn blue. Typical is this from West Virginia University via its “spokesperson” April Kaull:

[O]ur nation’s research universities cannot maintain research programs essential for continued national prosperity [unless Federal research funding is continued].

This is cynical and disingenuous, and grown adults should know better than to throw a temper tantrum. It’s perfectly straightforward for university managers to do the things promised in those universities’ bragged about policies—free and unfettered enquiry, with freedom of speech and of academics. In fine, stop the antisemitic bigotry, cut out the discrimination on any basis other than plain academic talent and performance, expel those students who routinely violate those tenets, and fire those university personnel—including tenured professors—who violate those tenets. That just takes a modicum of moral courage.

Of course, I’m being generous to suggest these personages are morally bankrupt—that implies that they had morals to begin with. Condoning, or even merely accepting, bigotry—antisemitic, racial, sexist, whathaveyou—demonstrates a complete lack of moral sense.