How to get rich during Trump's 4 years in office.

I was wrong! DOGE + tarrif turmoil = I'm getting out of stocks.

The Stock Market

After Trump won the election by a landslide, I did a post 11/25/24 titled "How to get rich during Trump's next term". Well, things have changed quickly and I wanted to give you a heads up that I have reversed course on my stock market half of that prediction. In that post I said that I was very bullish on both real estate and the stock market. I expected the stock market to do very well because of the de-regulation and the corporate tax reductions I expected president elect Trump to quickly enact. The stock market likes stability and what I didnt take into account when I predicted a booming stock market was the chaos caused by tarrifs. Worse yet is the market uncertainty caused by DOGE dismantling important government agencies. Then we have the crypto contagion which I didnt even see coming.

Crypto contagion of Wall Street

I guess I was naive. When president elect Trump promised to be a crypto-friendly president I guess I had something else in mind. I assumed that EFTs of BTC were the end of it but now its sounding like the way has been paved for every memecoin to have an ETF too. Then there is the Hagerty stablecoin legislation which would cement the fate of Wall Street to the previously firewalled and very voliaotile crypto markets. Imagine what might have happened back during the Sam Bankman Fried FTX Crypto-Crash had there been all the Wall Street funds in BTC ETFs like there are today - the crash could have affected everyone rather than just the crypto-speculators. It looks like soon, Wall Street will be far more exposed to the crypto market gyrations.

My new investing position

First, remember that I am 65 years old and the older a person is, the less risk averse they are because I simply do not have the “time in the market” to recover from a dotcom crash, S&L crash, or depression era crash. Two weeks ago on 2/17/25 I sold off S&P500 funds to get the percent of my assets in the stock market down to 25%. Here is my current asset allocation as of 2/17/25:

The stock I sold went into very safe short term t-bills which are earning excellent interest rates. Should the stock market have a correction and become more attractive then I would put my cash back into the market.

Real Estate

My recommendation for real estate as an excellent investment still holds and I am very comfortable holding 41% of my net worth in real estate. In fact, I expect it to do even better now because tarrifs on Canadian lumber will cause the cost of home construction to rise significantly on top of inflation which also looks like it will be higher than anyone expected.

Precious Metals and Crypto

I have 12% of my net worth in what I call “Plan B” investments which is precious metals and crypto. Crypto is speculation and I am fully prepared for it to be worth zero but I want some just for diversification. I am still in “hold” with regard to BTC but should it get below 60k I would consider gambling some more money on it.

Time in the market > Timing the market

For decades this is exactly what I did and it served me very well. Just Dollar Cost Averaging (DCA) by putting a fixed percent of my income into a S&P500 index fund and leaving it alone worked very well. I am worried its differernt now. Doge is firing federal employees indisciminently and opaquely. My concern is that they may have fired SEC employees responsible for monitoring compliance with the “guardrail” regulations put in place to prevent market meltdowns. If you look at the stock market crash of 1929 it is a sobering reminder that time in the market does not always beat timing the market.

After the stock market crash of 1929 it took 25 years to get above where it was in 1929 and many of us cant stay in the market that long.

Disclaimer: I was wrong and will be wrong again

Its only been 4 months since I predicted that the stock market would be an excellent investment and I have already done a 180. The truth is that the economy is in uncharted territory here. I based my predictions on watching the markets over 40 years but clearly the underlying rules have changed making it very difficult to use past experience to predict the future. In other words, I have no idea what I am talking about :)