Lansing Street Advisors Q4 Letter - America


The markets never fail to keep us guessing, but this year has shown even more evidence that predicting markets is a fool's game. Remember my Q2 letter? For the first time in 23 years, all Wall Street strategists predicted negative stock returns for 2023. How did that turn out?

This year we have witnessed some astonishing statistics. At one point, the Magnificent Seven was responsible for the entire return of the S&P. More money has flowed into Tesla's individual stock than into the S&P 500 ETF. Additionally, the Magnificent Seven boasts a market capitalization three times larger than the entire American small-cap stock market (2000 stocks).

If you want to be ostracized at an American cocktail party, simply state that you believe the Magnificent Seven will not continue to lead the market or suggest that Nvidia may be overvalued. It's even worse than not believing in global warming or being unable to meditate.

But here comes 2024, with one presidential candidate carrying ninety-one felonies, and the other facing an impeachment hearing with plummeting poll numbers. As we know, market discussions surrounding the presidential election will intensify. If you thought Wall Street strategists were bad at predicting markets, just try using politics as your guide.