Tariffs, Trade, and What We’re Watching
Trade policy has moved to the center of the economic conversation, and with good reason. The tariff increases announced in early 2025, and the ongoing negotiations that followed, represent a meaningful shift in the cost structure facing many U.S. businesses. We want to explain how we think about this environment, what it means for our portfolio decisions, and where we think the real risks lie. What Tariffs Actually Do A tariff is a tax on imported goods. The company importing those goods pays the tariff, and depending on the competitive dynamics of their market, they may pass some or all [...]
Letter to My Daughters: On Patience
I want to talk to you about patience, specifically, patience as an investor. It may be the single most important quality you can develop, and it is also the one that most people, even smart people, find almost impossible to maintain. The problem is that patience is invisible. When you are being patient, nothing appears to be happening. And in a world where something is always happening--markets moving, headlines rolling, financial commentators confidently explaining what it all means--doing nothing feels like failure. It isn't. Why Patience Is Hard Human beings are wired for action. When something feels wrong (a market [...]
Navigating Market Noise: The Challenge of Separating Signals from Distractions
In the fast-paced world of investing, one of the most crucial skills is learning to distinguish between meaningful market signals and temporary distractions. Recent discussions among our investment team highlighted this ongoing challenge and the nuanced approach required to navigate today's information-rich environment. The Nature of Market Distractions Market participants face a constant barrage of what we call "distractions" – pop culture events, policy announcements, speculation on Federal Reserve moves, and other news that can dominate headlines and investor attention. While these events may seem significant at the moment, many prove to be temporary diversions from the underlying economic and [...]
When Emotions Hijack Your Investment Returns
There's a paradox at the heart of investing that costs people millions: their investments often perform far better than they do. An investment strategy might beat the market by 3% annually, yet the average investor in that strategy loses money. The culprit? Emotions. Fear is a powerful force. It whispers in our ears during market volatility, urging us to abandon our strategy at precisely the wrong moment. It convinces us that this time is different—that the rules we established in calmer moments no longer apply. It transforms a rational investment process into an emotional roller coaster where we buy high [...]
Memorandum #155
In this issue of the Memorandum, Jeff and Ron Muhlenkamp recognize that even with dramatic policy headlines around DOGE, tariffs, and immigration through the first half of 2025, the primary investment impact has been a notable 25% year-to-date increase in gold prices, prompting the firm to maintain cash reserves for potential recession opportunities while continuing a disciplined approach of selling disappointing holdings and capitalizing on promising investments.. Read more of their insights in their current Quarterly Letter. In "What Makes Muhlenkamp Different," Tony Muhlenkamp highlights what really sets Muhlenkamp apart from other money managers is something that can’t be easily [...]
Your Picky Purchasing Agent in a World of Games
Every day, you're bombarded with investment advice. Financial news channels flash stock tickers and breaking market updates. Social media influencers tout the latest "can't miss" opportunities. Your inbox fills with newsletters promising to reveal the next big winner. Everyone seems to have an opinion about where you should put your money. Here's the problem: most of these people aren't paid to make you money. They're paid to sell newspapers, generate clicks, entertain audiences, or move financial products. The only group that publishes the actual results of their advice? Professional money managers who are paid to manage other people's money. We've [...]
Navigating Today’s Market Realities
Investors face a complex landscape: cash and short-term bonds offer modest returns that, after taxes and inflation, do not currently keep pace with rising living costs. For example, a 4.2% Treasury Bill, when taxed at 35% and adjusted for 3% inflation, loses 0.3% per year[1]. 10-Year and 30-Year Treasuries yield 4.3% and 4.4%, so they are in the same boat. The S&P 500 has a YTD Loss of 5.45%[2] after seeing a steep drop and an equally steep bounce in early April. Investors can look overseas, but that’s not a sure thing at all. It seems like there is nowhere [...]
Memorandum #154
Jeff and Ron Muhlenkamp discuss the first quarter of 2025, which saw stable economic indicators like CPI. But significant government policy shifts, particularly in tariffs and regulatory restructuring, have created uncertainty and market volatility. While we are monitoring potential risks like inflation and recession, we remain focused on identifying profitable investment opportunities amidst these changes. Read more of their insights in their current Quarterly Letter. In "Managing Your Portfolio in Uncertain Times," Tony Muhlenkamp discusses how uncertainty in the stock market is constant, making it essential to focus on what you can control rather than attempting to predict the unpredictable. [...]
So Far the 2020’s Don’t Look Like the 2010’s
Portfolio Manager Jeff Muhlenkamp reviews the impact of national and international policies, the state of the US economy, the global economy, and changes in the political environment on investment opportunities. Watch the April 3, 2025, Investment Seminar recording. The opinions expressed are those of Muhlenkamp & Co. and are not intended to be a forecast of future events, a guarantee of future results, nor investment advice.
Is It Time To Play It Safe?
In a recent Bloomberg article, our portfolio manager, Jeff Muhlenkamp, summed up the current state of financial markets saying, “You’re going from an environment where everybody was certain to an environment where nobody is certain, and in and of itself that will impact the market.” As we’ve always maintained, financial markets hate uncertainty. Investors worldwide have recently shifted to a “risk-off” mindset—meaning they’re prioritizing safety over chasing big gains. This is foundational thinking at Muhlenkamp. Think of it like swapping an aggressive rollercoaster ride for a sturdy umbrella in a storm. Over the past few weeks, many have sold the [...]