First, sh*t happens. They used to call them Black Swan events, because there were very few of them. You couldn’t predict them. Their effects were devastating.
Recent Black Swans include The financial Crisis of 2008, Covid of 2022. and Donald Trump’s Election of 2024.
Second, the next Black Swan event is coming soon — before the end of Trump’s reign.
Third, you have to take some money home. Forty years my father visited from Australia and told me “To take some money home.” I did. And Susan and I bought a country property which we still have and which has provided the family immense pleasure over all those years. And still does.
“Take some money home” has two big implications — Things change. When your holdings go parabolic — like Nvidia did — you need to take money home. Preferably what you paid and then some.
Parabolics don’t last — as I learned so painfully this year. Parabolics are momentum-driven. They are buoyed by unshakeable enthusiasm — like I had for Nvidia’s AI dominance and ebullient earnings.
Be careful who you believe. Wall Street analysts to this day still maintain lofty stock price expectations on Nvidia– despite the Trump Administration’s gutting Nvidia’s future with insane restrictions on sales to China. Has the Administration not seen DeepSeek and RISC-V, an open-source architecture, which is being used by the Chinese to cleverly circumvent U.S. export controls and to develop chips with military applications.
Parabolics don’t last. Part 2. Technology is often the “fault.” Two examples:
+ What made the shoe industry (and Nike) explode was the invention of decent glue. The old days of taking your broken shoes to the shoemaker for stitching were over. But so was Nike. Everybody and their uncle could make sneakers that were cheap, durable and stylish. Make a nice upper and slap it with glue to a one-piece sole..
Bring on the glue startups. Hello ON, Hoka, Skechers, Allbirds, Flux, Atom, KIzik, Cariuma, Will’s Vegan Shoes, Veja, Flamingos Life, Ecoalf and a zillion more which Amazon sells for $30 a pair.
Technology killed my old business of print publishing. Luckily I took money home before the Internet killed magazines about the internet before the Internet.
Fourth, diversification is the only free lunch. Except it’s not. If you outsource your “diversification” to someone else — most likely a fund or an investment banker — they’ll screw it up. Reason? They’re not you. They don’t have your self-interest. They’re concerned with their fee as a piece of your declining capital. You’re worried not about their fee but about your declining capital, which (at least in the beginning) is more than their fee.
Five, When things go awry with parts of my “diversification,” there’s nothing I can do. Or very little. Let me tell you about the modern “art” I own. Guess what’s happened to the art market in the last few years?
Let me tell about my commercial real estate syndications in gorgeous suburbs where rent is cheaper than downtown but still too expensive to attract any self-respecting tenants, like lawyers or accountants.
And bitcoin? Have you see it recently? A few days after Trump was elected it hit $103,332.30. It’s now around $84,000.
The hope is that one or two diversifications will succeed and make up for the rest. Sometimes that works. Sometimes it doesn’t. Basically, nobody knows. (My favorite Saturday Night Live words.)
Sometimes, the best “diversification” is a treasury bill, a muni bond or, God forbid, a stock index fund like the S&P 500 or even better, Berkshire Hathaway stock.
All this is great theory. Diversification. mostly works. Except there are some years — like 2025 — when nothing is really working.
And then, there are the mini Black Swan events. The past couple of months I’ve hit two deer with my trusty Subaru Outback. Total out of pocket repair cost: about $10,000 in cash.
Why didn’t I claim on my insurance?
That’s another story for another day. I still do have my insurance – unlike those unlucky people who live in Florida or California in the most beautiful spots in the world.
Something achingly familiar …
Leaving my granddaughter’s brilliant performance yesterday, we walked past Boston’s Old North Church. My iPhone captured its grandeur and the gorgeous Spring day.
Old North Church is famous for its role in Paul Revere’s midnight ride on April 18, 1775. On that night — exactly 250 years ago — the church’s sexton, Robert Newman hung two lanterns in the church’s tall steeple, which alerted Revere and the other riders to British military movements — two lanterns meant the British were coming by sea. Thus followed the Battles of Lexington and Concord, the first engagements of the American Revolutionary War.
As I photographed the Church, I wondered if we’re at the start of another revolutionary war against another king.
I pray we win this one, too.
We will.
Travel tips for 2025
Do not leave the U.S. for now. There are many reasons.
+ Overseas, they don’t like Americans any more. You won’t be welcomed. Especially in places we’ve abandoned, like Europe.
+ You may have trouble getting back in. You can be held for hours. You can be badgered into opening your computer and your phone, the contents of can be dumped into computers run by Immigration, which can also access a myriad of government databases, revealing stuff about you that, most likely, is just plain wrong.
+ If you travel to some exotic place, like Africa, you may contract something nasty which we no longer can fix as a result of all those cuts by RFK Jr. et al.
+ If you’re a woman who changed her name many years ago, you need to have originals, copies and digital images of every significant event in your life — from your birth certificate to your marriage certificate. — and all those in between. Not having all this information can make you look suspicious.
+ If you do leave, please clean your phone and laptop. Pay attention to selfies of you with “enemies” like Biden or Obama or their families. Better, take a burner phone and a new clean laptop. A friend actually takes a flip phone, with no memory and no apps.
I’m paranoid. You should be too. We can all be disappeared. Remember we are paying El Salvador a hefty fee to disappear people we don’t like — with none of them ever having their day in court.
My lawyer has advised me not to leave the country as a result of yesterday’s blog,. He says I now “have a target painted on my back.”
I think that’s overly alarmist. What I’ve written is nothing more dramatic or alarming than what dozens of newspapers, podcasts, blogs, TV shows and Instagram have published — meaning to make public.
Favorite fake photo
Today is Good Friday. I’ll be back, I hope — Harry Newton
