I already received the calls and emails from various clients saying they have moved their entire TSP into the G fund.
I understand them. It’s not “crazy.”
But it’s not what I’m doing for my own accounts (my wife is a Fed, she has a TSP, and she has not adjusted her TSP allocation one bit).
I don’t foresee the end of America, nor the end of the American economy, and here are SIX things I keep in mind that let me ride out the storms:
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Businesses have a vested interest in making profits. This simple truth doesn’t change with tariffs nor trade wars. So long as there are companies, they will seek profits, and as long as investors exist, they will want to invest in profitable companies.
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Investors have an interest in making money. That’s why they invest. And they will continue to put their money to work when the slightest sign of optimism returns.
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Signs have been showing that Trump is backing off his tough stance, and the market has already recovered about 5% of it’s loss since when I first started typing this report a week ago!
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Trade policies come and go. New administrations bring new policies. This is not a permanent fixture of American trade.
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A bunch of the US companies represented in the C fund and S fund have a global presence, and it could be that they would only be mildly impacted by a global trade war.
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Time is the ultimate risk mitigation technique when it comes to broad stock investing (which is exactly what the C & S funds are). If you give it time, you are usually rewarded.
I’m reminded of one of my favorite quotes from Warren Buffet: “The stock market is a device for transferring money from the impatient to the patient.”
Every time you see a drop in the stock market, there’s a transfer of wealth taking place. Which end of the transfer would you like to be on?
Wishing you success!
