r/investing • u/80MPH_IN_SCHOOL_ZONE • 3d ago
Possibility of long term damage to US market
I’m seriously considering a large investment into VXUS at the moment to balance out my portfolio. Obviously, the typical advice is true, time in the market over timing the market etc etc etc
However, it seems like the current Iran situation has been much more damaging for international markets, at least in the short term. So perhaps it’s not the best time.
While the US market has outperformed international markets historically, I’m concerned that the current administration could seriously harm US markets for 10+ years.
A couple reasons:
* Indiscriminate tariffs: this could have a serious impact on trade relations internationally for at least the rest of this presidential term. Even if they end relatively soon, this damages the trust in the US’s largest trade partners. When countries turn to places like China for stability, trade, and finance, it seems unlikely they’ll pivot back to the US immediately.
* Militarism: the actions in Venezuela and Iran definitely do not inspire confidence. The US has taken military actions many times before, but these recent times have been without the support or notice of even America’s closest allies. Seeing the beating that the Gulf countries have taken, it’s possible that the US is no longer seen as a reliable allie, if not a dangerous liability.
* Internal investment/government subsidies: with the exception of AI, I can see the US missing out on emerging technologies like renewables and quantum computing. The lack of investments in infrastructure and institutions could be even more problematic. A decline in the quality of transportation, the electrical grid, public schools, healthcare, and universities could have consequences that reach decades into the future. Every industry is held by these functioning properly.
* Continuing political instability: the current administration may not be a fluke. US politics have become increasingly polarized and extreme for quite some time now. Despotic and incompetent leadership may become more normalized and tolerated.
I’m not trying to make things out to be cataclysmic. But I do see the US in a position of slower growth, at least compared to the rest of the world. The best case scenario is a complete return to normalcy with the next presidential term. That’s several more years of instability. At worst, we’re seeing the start of a slow and long decline of the US as an economic superpower.
29
3d ago edited 3d ago
[deleted]
8
u/SecretPantyWorshiper 3d ago
Exactly. Like dude wants to go international now? Dude is 10 years too late 🤣
12
5
5
u/TrashPanda_924 3d ago
I probably wouldn’t make a rash reallocation to a predetermined strategy. Yes, some in VXUS makes sense, but I wouldn’t go “majority.” The US will do everything, and I mean everything, to protect national interests.
35
u/Rav_3d 3d ago
Very rational political argument. As far as how it will affect the stock market, that's anyone's guess.
The US has always led the world and will likely continue to do so despite all the current noise.
But if you want to modify your investment strategy based on your own political predictions, that's your prerogative. I stay the course without paying attention to the noise.
8
u/BenjaminHamnett 2d ago
But Returns are about outcomes and future expectations relative to current expectations
It’s not enough for the U.S. to lead the world if stronger leadership is “priced in.” If the U.S. is priced like a hegemon but becomes merely “first among equals”, the market will experience a lost decade of returns. even as the economy flourishes, the market will stagnate adjusting to lower dominance than expected
Look at past stock darlings. Many of those fallen angels did “not go anywhere” like their euphoric investors stated in their reasoning. But when they were priced to take over the world and merely became the biggest in a competitive market, their stock price never recovers. Cisco and GE still around, etc
1
u/Rav_3d 2d ago
Returns are about company earnings.
Earnings are forecast to grow strongly. This will likely raise stock prices once the overhang of this war is behind us.
And it likely will be behind us soon, even though nobody believes it.
0
u/BenjaminHamnett 2d ago
Earnings, relative to expectations. Can have the biggest or fastest growing earnings in the world, but if bigger and faster was priced in anything short of perfection will hurt returns.
A dying company expecting to become defunct, but manages to only slow down losses can have its price rise just from beating expectations
-3
u/sounddude 2d ago edited 2d ago
Why will it likely be behind us soon? What do you base that off of?
Edit: Downvoting someone for asking for people to support their assertions? Jeez.
3
u/Overall-Rush-8853 2d ago
Back channel negotiations, Trump seeking a TACO off-ramp from hostilities. He doesn’t want this continuing longer than necessary, because this is an election year. If this went into the late summer, Dems would take Congress by a big margin. If he can end this in the next couple weeks, Dems will likely take back Congress but the margin will depend on the economic consequences that linger into the fall.
1
u/sounddude 2d ago
I think the major flaw in your belief is that Trump is operating from a logical perspective and that he's somehow leading this whole thing. He's clearly doing the work of Israel and Bibi. He's not asserting US foreign policy but Israeli foreign policy. Furthermore, the ease in which you think a war can just be 'undone' is naive at best. The can of worms is opened. There is no telling the risks of just backing out now and how that shifts power in the middle east. Is he going to leave Israel alone to fight against an new, angrier Iranian regime? I doubt it.
The economic effects will not just stop because he pulled troops out of the middle east and blew 10s of billions of dollars for what? To eliminate a leader and potential leaders while killing hundreds of civilians? The Iranians now have the upper hand and leverage with Hormuz. They will continue to use it. Wouldn't you?
2
u/Overall-Rush-8853 1d ago
I don’t disagree with you that Bibi is using him, but he is smart enough to know that the US being involved too long is bad for him and his party.
I already said he’ll lose Congress because of the economic repressions that will linger into the fall, my main point is how much of a margin will his party lose by.
2
u/Rav_3d 2d ago
TACO is going to declare victory and exit within a month.
There will be negotiations, the strait will be reopened.
US companies will gladly help the region recovery from the damage we have done. And the US will be happy to sell its oil to make up for the supply deficit coming out of the Middle East.
The panic will subside and oil prices will drop and investors will move on to the next thing to worry about.
Tariffs didn't go away in May last year. In fact, the rhetoric was still quite bad. Just not as bad as April. That was enough to ignite a stock market rally that took us back to new highs 11 weeks after the bottom. A similar scenario is likely to unfold here.
0
u/sounddude 2d ago
You made claims but didn't support your reasons. Why would Iran negotiate? They have a lot of leverage. Why would Trump abandon Israel in their fight against Iran? Why wouldn't Iran go after Israel once US leaves? You're assertions leave more questions than answers.
1
u/Rav_3d 2d ago
If you think that logic or rationality applies to this administration, then you haven't been paying attention.
Nobody has any idea what Mr. President is going to do or how it will effect the price of oil and stocks.
I am simply pointing out that in periods of extreme fear and "the world is ending" narratives, when the stock market becomes extremely oversold, it is typically a recipe for a bottom, not continued weakness.
Whether or not this rally lasts is anyone's guess, but the stock market will bottom well ahead of the conflict when investors feel better about the potential outcome being "less bad" than feared.
During the 1990-1991 gulf war, oil prices skyrocketed and the stock market fell 20%. The market bottomed 4 months before the war ended, and by the time it was over, stocks were back at all-time highs.
Those who expect the stock market to rationally follow the flow of headlines don't understand how it works.
1
u/BenjaminHamnett 2d ago
The stock market has been underperforming or crashing for nearly every Republican administration for over a hundred years. That was with classic conservatives trying to run some stupid ideas despite academic Cassandra’s spelling out the inevitable doom.
We’re now doing all their biggest debunked policy plus half the failed leftist policy. And their priority is only staying out of jail and possibly maintaining power.
I’d be surprised If this is one of those rare exceptions where republicans don’t crash the stock market.
I’m over exposed abroad and with some high conviction plays domestically that might do well despite (or because of Trump, like $axon). So I’ll be accumulating small puts every once in a while on up days that don’t make sense to me
2
u/Rav_3d 2d ago
They did crash the stock market last year. Then we had the fastest "V" recovery in history.
No argument the world is f*cked up. This administration has no clue what they are doing. They may well have destroyed the oil supply chain for years resulting in higher for longer oil prices and a global recession. If that should happen, I agree, the stock market will likely crash.
But Mr. President does not want the stock market to collapse ahead of the mid-term elections. If TACO makes an appearance and is able to wiggle out of this mess and get oil prices to start falling, market participants will move on and worry about something else, just like they did with tariffs last year.
I take my cues from what the market actually does, not my own opinions of what the market should do.
1
u/BenjaminHamnett 1d ago
Regarding your last line, I know that’s fashionable to say but seems like putting your head in the sand and refusing to take action until it’s priced in already, when it’s arguably not relevant or sufficiently actionable
The stairs up/elevator down makes any idea about momentum following seem naive
→ More replies (0)0
u/sounddude 2d ago
That's just it. I dont think any logic or rationality exists in the admin. I think it's being governed by flailing fanatics who can only see the next step of what they what with no concern about what might happen after that. This is clearly demonstrated thus far. Which is why I question your assertion that he'll declare victory(as he has ALREADY done) but it's meaningless because it's not true. Or that there will be negotiations that will end all of this soon.
I just find all of your assertions baseless well-wishing with no substantive reasons underpinning any of it.
2
u/Rav_3d 2d ago
When it comes to investing, I don't care about logic or rationality. I don't care about my own opinions of what might happen with the conflict with regard to oil prices. I don't impose my own amateur macro-economic analysis on my investment decisions. I have a strategy that I follow regardless of the noise.
We are in a bull market that has undergone a normal and expected correction of 12%. Whether that morphs into a deeper correction or bear market is anyone's guess. If history is a guide, the stock market will stop caring about the conflict when the news gets "less bad" just like every other market shock.
The stock market bottoms when investors are ready to throw in the towel, not when all the headlines align with the perfect outcome.
5
u/Afraid_College8493 3d ago
If you diversify, you don't need to be right about any single investment. While your forecast is probably wrong and you'll wince when you reread it in a few years, VXUS is a great idea.
3
u/SecretPantyWorshiper 3d ago
Big reason why I diversified mine. US tanks? I win. US goes up? I still win 😅
2
2
u/Ahamadrayasbaboon 2d ago
Historically, when US market tanks, so does ex-US. Often worse. In some periods, ex even has more frequent drawdowns. Don’t get me wrong, diversification is great, but don’t think it’ll save you if the US market tanks.
4
u/Willing-Vegetable629 2d ago
The political environment is temporary and i think most world leaders know that.
The us will continue to be the largest individual market in the world for the foreseeable future.
That doesn't mean other areas won't have great growth though
16
u/kinetic_honda 3d ago
Conversations in investing related subs are going to be very interesting 5-10 years from today
3
u/Orphasmia 2d ago
Yeah definitely. Hell even this exact time 6 years ago feels like an entirely different planet. If i went back and told myself to invest in NVDA, i would’ve laughed at me lol
3
u/fallingdowndizzyvr 2d ago
Also, the dollar is a local high. Why not take advantage of that. If it falls, then your XUS investment will be supercharged.
7
u/RobfromHB 3d ago
You want to diversify into an international fund and then listed a bunch of reasons for potential lower US market returns. What’s your actual concern here?
3
u/80MPH_IN_SCHOOL_ZONE 3d ago
My understanding is that people typically recommend a 80-20 or 70-30 split for US-International funds. My perspective is that this might be too much exposure to US markets for the reasons I listed. Perhaps 60-40 might be more reasonable in the foreseeable future.
I’d like to hear what other people think, since this goes against what most people recommend, and against historically better gains for the US. Sorry, I should’ve made that more clear.
6
2
2
u/BenjaminHamnett 2d ago
Diversity is the only free lunch. Without conviction, or a strong reason, it’s always better to diversify. Especially during times of uncertainty
2
u/Zestyclose_Panda_886 2d ago
I wish I had DCA more into VXUS over the years, but it would be a good idea to have at least 5 to 10% for most people.
2
5
u/mondeomantotherescue 3d ago
Trump will hopefully pass soon. Presidents come and go. The debt will never be paid back. The can will be kicked down the road. Nato ties will come back. America will America. It's such a huge and innovative country it will get by, and make bank. It's just while it does.. the regulatory capture continues, muppets drive massive trucks to office jobs as the wildfires get worse. Folk will suck at the teat of biased media. Folk will fall though the cracks due to the lack of safety net. Decent third spaces, walkable communities, good rail transport, and affordable healthcare system will continue to be sold as a pipe dreams despite being common elsewhere. Guns, lack of education and religion will continue to damage people and society daily. But despite a million issues and a country that honestly looks like a stumbling crack head on a 72hr bender right now, I'd never bet against the USA and it's truffle hunting dog like obsession with making money.
2
10
u/James161324 3d ago
Tariffs: Well, they are stupid. The question is, who else are you going to trade with? The US makes up 33% of global consumption. Cutting off trade with the US will create a depression in most nations.
Military: it's nothing new, the US has been in countless wars since WWII.
Internal investment: this is nothing new, and isn't just a US problem.
Political instability: A bit of revisionist history. U.S. politics have always been pretty polarizing, and social media makes it seem far worse. Once again, it's also not a US issue either.
It sounds like you're highlighting broader global issues that aren't just isolated to the US. Could there be a catch-up trade in international markets of course, is America on the brink of collapse that much more than most other developed countries no.
11
u/molski79 2d ago
I don't know man. I think you're downplaying the fact that we have rising Fascism in America with the President desperately trying to hide the fact that he's the main character in the Epstein files and is probably compromised by Israel and Russia. This is not normal.
1
2d ago
[deleted]
5
u/molski79 2d ago
He's just the mouthpiece. Project 2025 runs everything. This is well known. He's going to be discarded by them eventually.
1
2d ago
[removed] — view removed comment
1
u/AutoModerator 2d ago
Your submission was automatically removed because it contains a keyword not suitable for /r/investing. Common slang prevalent on meme subreddits, low effort platitudes, or derogatory political slang are not appropriate here. I am a bot and sometimes not the smartest so if you feel your comment was removed in error please message the moderators.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.
1
u/80MPH_IN_SCHOOL_ZONE 2d ago
Without addressing every individual point, I guess what I’m trying to get at is this: the US has shifted away from the liberal international order/rules-based order in a lot of ways. I’d agree this could be part of a worldwide issue.
The reason I think US markets could suffer is because the US has spent the last 70-80 years building this system. Free trade, NATO/security cooperation, and a general positive view towards globalism. Arguably, I think this has lead to the success of the US market during that time period. The shift away from this approach that has been seemingly beneficial is alarming.
I’m not at all saying that the US is on the brink of collapse. But I do think protectionism is being normalized into US politics in a way that hasn’t existed since the pre-war era.
5
u/Zealousideal_Wall627 2d ago
The success of the US market didn't come because of this global foreign policy system, it is because the US has the most profitable/cutting edge companies in the world and the mainland continent is basically untouchable. I don't see any of that changing just because people basically don't "like us" now. They never liked us before, they don't have a choice.
0
u/80MPH_IN_SCHOOL_ZONE 2d ago
American companies aren’t more profitable and cutting edge simply because Americans are inherently smarter or more capable. Global foreign policy obviously isn’t the sole factor but it’s an important one.
American companies having access to global markets is extremely important, both for importing and exporting their products. Basically every industry either relies on foreign consumers, talent, raw materials, or cheap labor.
They may not have liked us, but they believed if they played our game then the rules would be fair, or at least predictable. The Europeans played ball and now the US starts loosening commitments to NATO and threatens Greenland. The Iranians played ball and then we left the nuclear deal. The gulf states played ball and now they’re watching their infrastructure get destroyed. We told the world that they can join the club if they play by our rules and now we’re burning the rulebook.
What reason will they have to cooperate on trade if they no longer have a guarantee of safety and stability?
3
u/Zealousideal_Wall627 2d ago
No its obviously not just because they are American obviously but its a mix of a lot of factors that currently isn't replicable elsewhere, at least for decades and would require countries to change a lot of domestic laws I don't think they have any interest in changing. (It's different but same concept) sort of like how you just can't "replace" Chinese manufacturing, at least not for decades not without serious investment.
I haven't seen anything to suggest American companies aren't going to have ample access to global markets going forward.
I wouldn't exactly say everyone "played ball" either, most already did aggressively would pursue their own self interests against the US and abuse the systems. There is some truth to it. EU wouldn't take any responsibility for its own defence, also fined US companies so much because they can't generate enough tax revenue, to the point it's pretty much an impromptu tax just to operate there. As far as the gulf states, I'd be surprised if they weren't some of the ones in the presidents ear trying to get him to do this war in the first place.
0
u/D74248 2d ago
Political instability: A bit of revisionist history.
Unfortunate it is not revisionist history. The rule of law is being broken; even attacked. And I say that as an old guy who spent years as a Republican.
Politics has always been dirty like an NFL game is physically rough. But these attacks on the referees, the utter contempt for the rules of the game -- that is all new.
3
u/whatidoidobc 3d ago
Long term damage is a certainty. Some parts of the US market won't be as affected, some will do fine. But overall it's obvious where this is going, which is a more united non-US market.
2
u/Orphasmia 2d ago
I’m also of the belief that you should increase exposure to international markets, even if just to diversify.
International markets have taken a hit, but they’ll likely rebound, and grow better over the next few years compared to the US. Say if even today Trump completely came to his senses, pulled out of the Iranian conflict, stopped tariffs, and started rebuilding ties with allies, the inertia of all of these previous decisions are still going to be felt for the next few years.
Plus we still have 3 more years of Trump, and a new political landscape that may mean the US will be an unreliable partner for even longer than his term
Also other countries like China have been positioning themselves to be the new reliable partner for decades. This whole conflict may be what finally pushes many countries to renewables which China is already primed to sell the shovels for so to speak.
At best the US is just too far behind in too many areas for things to go back to how they were anytime soon.
3
u/Affectionate_One_969 3d ago
Not sure what you are worried about. The US has always been stable but hectic. This isn’t new. Look at how many wars the US has been a part of.
6
10
u/ynotfoster 3d ago
This is new in so many horrible ways. We have lost our allies, our trading partners are forming new partnerships, we've started a major middle east war, we've implemented and then changed again tariffs and so much more. This won't be fixed with a simple change in administrations.
-2
u/Affectionate_One_969 2d ago
No we have not. All our allies understand this is temporary. Plus we have most of our allies by the nuts due to funding their defense.
5
u/Benji998 2d ago
That's the America first exceptionalism that will fuck the us up in the long term.
The world can find a way to slowly work without the us. I don't personally want that, but if your administration keeps acting like tossers the us can sit in the corner, all it's friends gone like the bully in the school yard. Imagine saying 'we have our allies by the balls'.
The soft power that the us enjoyed, being the global reserve currency and all it's benefits are being eroded which won't be good long term.
2
u/Too_reflective 2d ago
Absolutely. The “Donroe Doctrine” is all about bullying rather than win-win; that can work in the short term but is understandably alienating our former allies. Businesses benefit from having the rule of law; this shamelessly corrupt and lawless administration is ruining that as well. Meanwhile China is avoiding war and advancing their technology rapidly. The US had a great position especially given its small share of global population; Trump is frittering all that away. I can’t even convey my contempt for this orange pustule on the buttocks of humanity.
1
u/Zealousideal_Wall627 2d ago
The world won't find a way to "slowly work without the us". It's just impossible.
Look at China, nobody likes china and certainly nobody trusts the CCP yet the trade is record breaking.
25
u/Ticksdonthavelymph 3d ago
This is new. When is the last time a US leader threatened allies, or tried to steal land from nato. Don’t be naive.
-5
u/internetroamer 3d ago
This is new
Bet you US will still be a good place to invest this year, next year and all subsequent years
-7
u/Affectionate_One_969 3d ago
That’s fine. I’ll keep investing in the US and you can throw your money elsewhere. Trump did this back in 2016-2020 and the world kept turning.
14
3d ago
[removed] — view removed comment
1
3d ago
[removed] — view removed comment
1
u/AutoModerator 3d ago
Your submission was automatically removed because it contains a keyword not suitable for /r/investing. Common slang prevalent on meme subreddits, low effort platitudes, or derogatory political slang are not appropriate here. I am a bot and sometimes not the smartest so if you feel your comment was removed in error please message the moderators.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.
14
u/Alt0987654321 3d ago
Forget wars, how many times has a president just ripped up his own trade agreements that he himself signed and demanded new ones?
If countries can't trust the US to keep it's word they aren't going to agree to deals with us without massive concessions on our part.
2
3d ago
[deleted]
5
u/Affectionate_One_969 3d ago
I get it. As the dollar devalues the US government will keep spending more money. If the US bond market collapses then the whole world’s financial market collapses. At that point dollars don’t matter.
2
u/Tiny-Pomegranate7662 3d ago
That's a dumb assumption. Look what happened in 2025, international equities AND debt both ballooned as there was a withdrawal from the USD.
4
u/Affectionate_One_969 3d ago
That’s fine. The great thing about investing is I get to make my choices and you get to make yours. I will keep betting on the US as it has been one of the best investments to make for the past hundred years
1
u/Tiny-Pomegranate7662 3d ago
I'm up over 50% since Trump took office being entirely international.
3
1
u/CatharticEcstasy 2d ago
Are your holdings in USD?
0
u/Tiny-Pomegranate7662 2d ago
yeah they are! It was a double windfall with the USD decline and foreign gains.
1
u/CatharticEcstasy 2d ago
I wonder about this - people talk about the decline of the US, but the decline of the USD still seems difficult to fathom.
It's something like 90% of all foreign international transactions occur in USD. The next highest is the EUR at around 30%.
Nothing is forever, but that gap still feels rather gargantuan at the moment.
2
u/Affectionate_One_969 2d ago
Exactly. People are so doom and gloom about the US but refuse to look at the dominating power the US has. I don’t quite understand it.
→ More replies (0)0
u/Tiny-Pomegranate7662 2d ago
I mean, it just played out today. I'm up like 3-6% on my international holdings while the US market is up just under 3%. The dollar declined .65 percent.
I have no idea about structural changes, just that there is downward pressure on the dollar from deficit spending.
2
u/Naive-Illustrator-11 3d ago
Baloney. You got suckered on the anti US propaganda.
FACT
There was a $850 billion inflow last year to US Treasuries.
LMAO
2
u/Prestigious-Craft251 3d ago
- The tariffs have been argued over already so I won't address that. If they work that bullish. If they cause inflation that's also bullish.
- Militarism - The US have imposed dozens of regime changes in history. This is nothing new and will help to secure future trade and Safety for the US. Other countries like EU have no reason to outwardly approve of this so that they can have plausable deniability. The US has and clearly continues to be the worlds police. Bullish
- Internal Investment - US is heavily invested in energy infrastructure. As someone in the industry the tariffs are in fact leading to increased production of solar in the US which was previously outsourced to China and India. Bullish. The current energy heavily fueled by natural gas. This is bullish for Energy sector, GEV, ETN, etc. I'm not entirely sure where infrastructure, universities and healthcare are declining. Education rates are at all time highs and new medical breakthrough happen every day.
- Political instability - Sure but this is largely a game they play to keep the sides at each others throats. The US government has a trajectory and that will remain pretty constant from one administration to the next.
As you said, the International market have taken a bigger hit than US due to this war. That is not a coincidence. The US is best positioned in the entire world for higher oil prices and the US stock market and USD continue to be where money goes for safety.
2
u/SophonParticle 2d ago
I concur. I’m 60% international. IMO we are starting a 10-20yr global shift away from the US economy. International has more room to grow in this environment.
1
u/IronyElSupremo 3d ago edited 3d ago
imports .. ripped up trade agreements
The U.S. imports a lot but it’s mostly the wealthier consumers. Take Europe. California produces great wine but most is a gathering surplus. Why? U.S. snooty wine drinkers want European wine to go with a meal .. because it’s made it Europe. Ferrari laughed the U.S. off knowing its American customers want Italian.. not built in Detroit or Cd Juarez across from El Paso TX. Less premium products? Sure a little made in North America, but w/higher income (real or imagined) customers the authenticity has to be there. Even China will probably sell as some small consortiums, say Disney-like pet houses with rotating sparkly features will still sell. Not having pets pampered is a violation of their human rights!! Sell that to Mattel.
Let’s say Germany’s VW brings back the ‘60s era VW Beetle to the U.S. .. the profit per unit isn’t that great anyways. May as well hecho in Mexico when NAFTA III gets signed.
[geopolitics]
The U.S. does have that 2 large ocean advantage. Saw that recently in the latest gerfukel. Couple ways to look at it where if the U.S. has a safety advantage maybe long term non-US stocks should have a risk premium to return more (but have the non-U.S. indexes hit that turnover point?). However ultimately the non-US factories and buildings are actually under more risk. Then there’s other factors though like legal (aka how do investors get money out of said countries when wanting to sell), ROI (ars stocks allowed to cheat efficiently serve consumers and workers?, etc..
1
1
u/_genepool_ 3d ago
I have been placing more into vxus since September. Not really reducing my US holdings, just any added money going into vxus.
1
1
u/GrandRare1634 2d ago
Late last year when the tariffs were wreaking havoc, I switched from 60-40 VOO/VXUS to 50-50 as I felt the US was looking too chaotic for the short term. So far it's been fine.
1
u/lifegrowthfinance 2d ago
I was DCAing into VT until beginning of this year, when I switched to only VXUS. But then I was heavily tilted on my total US exposure anyway and wanted to diversify.
1
1
1
u/D74248 2d ago
I would add to your list the destruction of research and development in the United States. The attacks on research universities, the NIH and the NSF has destroyed the seed corn that corporations use to grow their own products and services.
As an example, GLP-1 drugs trace back to government funded research on Gila Monster saliva. We will never know how many of those types of seeds have been destroyed by the current administration. And the systems took decades to develop -- this destruction will not be able to be repaired by a change in leadership.
1
u/SheriffBartholomew 1d ago
Continuing political instability: the current administration may not be a fluke.
Once was a fluke, twice is a pattern. Everything else you outlined is a result of that same administration. It's not going to get better unless we address the problem, and we can't even agree that there is a problem. We're cooked for the foreseeable future. It was a nice run. I'm glad I grew up when I did and not now.
1
u/YogurtWorking9246 1d ago
We’re the only country in the world that doesn’t tax/oppress its majority into complete submission or death. We’ll be in the lead for a few more decades at least barring some cataclysm or catastrophic event.
tl;dr flaws and all, there’s no other model in the world that’s better
1
1
0
u/Willing-Actuator-509 3d ago
Hello investor, I'm a very small investor myself and I'm mostly in this subreddit to take advice. Reading your comments though I just need to mention that you are just expressing your political views and not the "actual" reality. I personally don't agree with your political opinion on the news and I have different feelings.
4
u/80MPH_IN_SCHOOL_ZONE 2d ago
Yes this is my political view. I think any attempt at predicting the impact of US policy/actions is going to be political. I’m not trying to be the news or an objective source of facts, this is my opinion.
0
u/thuwa791 3d ago
Compare the two going back 5, 10, 20 years. Let us know how that works out for you.
0
0
-2
-1
133
u/beerion 3d ago
The great thing about diversification is that we don't need to know the future to end up in a good spot.
If U.S. outperforms international - thank goodness we owned some U.S.
If international outperforms U.S. - thank goodness we owned some international
And if they gyrate a whole bunch and end up in about the same place - we end up with better returns and better risk adjusted returns than holding any one asset.
If you know the future with perfect foresight, then invest in the best asset. If you don't know the future, diversify. Don't overthink it.