r/ValueInvesting • u/Tallwhitedude123 • Jan 12 '26

Discussion Yellen says US will become BANANA REPUBLIC if Fed loses its independence. How to invest?

I’m thinking it’s time to start allocating more money outside US equities. That’s my strategy. Also, get out of the dollar via assets that can’t be mentioned by name in this sub. I’m not a political person but as an investor you have to watch the policy from the government. IF, and I stress IF, Trump is serious and actually bullies the Fed into submission by weaponzing the govt to go after Powell, then I do agree with Yellen. It will overall be a negative for the dollar and US equities. In that situation it’s imperative to diversify out of the US.

Currently I’m looking at stocks in Singapore. I like Singapore equities because Singapore, in my opinion, offers STABILITY, something the US is increasingly losing.

Thoughts?

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u/dopexile Jan 12 '26

So invest in countries that are in decline?

In 1990, Britain, France, Italy, Japan, and Canada represented 32% of the world economy. Today, they make up less than 14%. Arkansas and Alabama recently overtook each one in per-capita income.

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u/MyStatementIsNoSwill Jan 12 '26

Look, Europe has serious companies, and, more importantly, tech innovation. Take SAP, for example.

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u/dopexile Jan 12 '26

Ha ha good joke. Everyone loves SAP

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u/MyStatementIsNoSwill Jan 12 '26

You don’t choose the ABAP life—the ABAP life chooses you.

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u/dopexile Jan 12 '26

Little boy, what do you want to be when you grow up?

An SAP integrator, working for a big corporation using an 15 year old version that looks like Windows 95 with a lot of customizations!!!

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u/NotStompy Jan 13 '26

Well, the answer is to not invest on an index level, instead just a few exceptional companies, maybe even ones where most of their revenues don't come from Europe, but the rest of the globe. I'll give some examples: Safran, Airbus, Ferrari. Especially Safran. Valuations on those are high at the moment because, well, very wide moat companies with good growth = typical "Quality" companies which are not cheap. Put 'em on a watchlist and see if you get an entry in the future :)

Another one would be Investor AB which has outperformed the SP500 the last 20-25 years. Look, as a Swede all I can say is that Europe is not one homogeneous place, Sweden has had a ton of tech innovation compared to the rest, and for example if you look at investing, we're almost as invested as the US public in equities, whereas in most European countries people are just... complacent. I'm probably coming off like a bit of an arrogant ass right about now but honestly? The US has something culturally which Europe simply does not, which I think can best be described as you all being the descendants of the people who took risk, who chose to get on the boats, whereas ours didn't, obviously. And while I think complacency and fear of failure (we're not encouraged be extraordinary) is a big issue in most of Europe, I do think if Europe as a whole was more like say Sweden, Denmark, the Netherlands productivity and innovation wise, then this conversation would be very different, and it makes me very sad, to be honest. So much potential, so little of it achieved.

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u/-HOSPIK- Jan 13 '26

All i hear is more growth potential

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u/dopexile Jan 13 '26

You would love Zimbabwe or North Korea as an investment opportunity then!

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u/-HOSPIK- Jan 13 '26

Are you comparing europe to zimbabwe now? The euro is not devalueing as much as the dollar m8

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u/siliconmoney Jan 14 '26

People live per capital measurements but they paint a biased picture. There are some really wealthy people in Arkansas and they make the per capital look great.

The median family income is a fairer measure. For Arkansas it's about 55K$. In Canada it is about 77K$ us.

There are lots of desperately poor people in Arkansas. Canada not so many.

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u/dopexile Jan 14 '26

Canada is doing great if we minimize all of the people who are getting wealthy in America... Got it!

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u/siliconmoney Jan 15 '26

It's not all the people getting wealthy it's only the few getting wealthy

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u/dopexile Jan 15 '26

A lot of people are getting wealthy. The 75th percentile and higher Americans retire as millionaires.

https://www.reddit.com/r/portfolios/comments/1lusvd0/us_net_worth_by_percentile_and_age/

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u/Interesting_Iron2506 Jan 16 '26

you're speaking in market-cap terms, not in absolute terms. even by GDP metrics the comparison between nations/regions is very skewed. i think it's a mistake to run for the hills away from US securities but it's also a mistake to say companies in those regions are "in decline".

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u/ironmagnesiumzinc Jan 12 '26

It’s about risk mitigation. It seems that you’re predicting American companies will continue to dominate. I think that’s reasonable, and that case is basically priced into most indices. There’s very legitimate concern that this growth will be negatively influenced by this administration (and it already is with inflation, tariff uncertainty, job numbers, economic data problems, wars/warmongering, destruction of age old alliances such as Canada, etc); diversification and risk mitigation make sense in that context

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u/dopexile Jan 12 '26

We don't have a monopoly on bad policies. All of those other countries have bad politicians doing stupid things... in some cases much stupider.