I became involved in international investing, mostly by accident, in the early 1980s, when I took a job managing an Australian portfolio for a big US-based money manager. Within six months or so, I also had responsibility for the rest of the Pacific, ex Japan. That meant mostly Hong Kong, Singapore/Malaysia and Thailand.

This was lucky for me, in two ways:

–my boss, a stern taskmaster, would call me into her office every day and call out ticker symbols. I had to talk about the price, trading volume, major buyers and sellers, and how the price action deviated from either the stock’s industry group or the market in general. I also had to know the brokerage houses involved in the trading. It was brutal at first, but it made me much more sensitive to trying to understand the stories behind price moves.

–this was also an incredible time for international markets, one we have not seen in the last quarter-century. The EU was being formed, as a counter to the power of the US; China was entering the post-Mao era; yen strength was causing a renaissance of Japan’s domestic economy; and labor-intensive manufacturing was shifting from the developed to the developing world.

All that began to fade away after Y2K, with American-led IT taking center stage. The UK’s blowing up the EU, the senescence of Japan, and the Chinese Communist Party’s reassertion of Mao-like control over that country were all also helpful, but of minor significance. A second major plus factor for the US, though, was that as the working population of the rest of the developed world aged, the US kept itself relatively youthful by accepting young hard-working immigrants.

Since the beginning of this year, however, the EAFE index of foreign stocks is up by about +8%. In contrast, NASDAQ is down by about 12% and the S&P has declined by about 7%. The spread between EAFE and NASDAQ is a stunning +20%. Against the S&P, spread is almost +15%.

It’s the kind of thing one might generally expect, given the strong anti-growth economic policies of the Trump administration. I’m surprised, though, that the relative decline has been so fast. Yes, despite his new hair color and more subdued face paint, Trump does appear increasingly Biden-esque. I don’t think worries about possible accelerating cognitive decline are the key factor here, though. To my mind, the bigger worry is that Congress seems to be amplifying the anti-growth, raise tariffs/shrink the workforce impulse emanating from the White House.