That’s what I think today’s US stock market feels like.

Several issues:

–yes, the US has been the worst-performing major world stock market last year, as well as so far this year. This weak performance comes despite the powerful upward thrust provided by US-based AI multinationals. Tancial press is just beginning to work out how poorly, in relative terms, the S&P has been performing–presumably because the last time we’ve seen a situation like this was over a quarter of a century ago

–domestic government policy during the current administration has been the unusual, GDP growth-inhibiting, combination of shrinking the workforce and raising the domestic cost of living through tariffs. The (sensible) stock market reaction has been to focus on bidding up the prices of companies with costs in $US and sales abroad. These stocks are no longer obviously cheap, howeverp. Arguably, they’re at least temporarily overpriced

–the usual stock market answer in situations like this is to roll out of recent winners and pick through recent laggards for possibly underpriced names. But these are by-and-large victims of the administration’s peculiar, anti-growth, economic policies. And to much of the rest of the world, the administration–ICE, in particular–brings echoes of the early 1930s in Europe. Not a good look, either for tourism or for investment

–in addition, there’s the executive branch suppression of the Epstein files, despite a Congressional order to release them. Wall Street is drawing the conclusion that the former is being done to protect high administration officials against prosecution for abuse of children. Again, not the stuff high PE multiples are made of.

Overall, then, it would appear that there’s no clear safe domestic haven to roll into. Hence, the move into EAFE names.

Hard to know how long this will last. My guess is that we’re far enough away from a move back to the US that this isn’t a concern for today. More relevant is how much of the portfolio to shift away from the US economy.

For what it’s worth, I’ve shifted maybe 40% of the money I actively manage out of US stocks, most of that in Hong Kong-listed Chinese names.