Don’t Let Politics Infect Your Portfolio

Andy Snyder|September 16, 2020

We’re sick.

Nearly a decade ago, we made waves when we published a piece that claimed the government was the average investor’s biggest risk factor.

At the time, we were debating public healthcare, counting stimulus dollars, pumping up the oil market and fighting a couple of lingering wars.

It left us with a cold sweat and a twist in our stomach.

Things have only gotten worse.

The nation’s economy is still dependent on stimulus dollars. Tax rates and Fed decisions steer the market. And the Dow’s daily gyrations hinge on the latest headline from Washington.

But this week, things hit an extreme.

China has come to America.

We need to lie down and put a trash can beside the bed. Our cold sweat has turned into a drencher.

Forcing this “virus” out of our system would be a tremendous relief.

Fighting One Evil With Another

Most folks have hardly followed the news. But on August 6, the president hashed out an executive order that would ban all domestic business with the popular app TikTok. He used an obscure law that allows the Oval Office to halt economic transactions during a national emergency.

The big problem in this case is user data.

China doesn’t like us. And this app allows it to – without a doubt – weaponize the data it collects from Americans.

But TikTok claimed with some 1,500 employees in the States, including top executives, that its American data is safe. It’s stored outside of China, and nobody within the country has access.

Trump doesn’t believe them… and neither do we.

The executive order kicked off an odd string of events. Microsoft, as you likely heard, offered to get in on the game. Its proposal would have removed Chinese ownership of American assets and severed ties.

TikTok rejected the deal. It won’t make any sale that eliminates its access to the code and algorithms that make the video platform work.

That’s where Oracle comes in.

Friends in High Places

After a failed bid to pick up a $10 billion Pentagon contract, Oracle founder Larry Ellison clearly feels his pals in the White House owe him something… especially since he recently threw a lavish fundraiser for the second-term hopeful. (A $100,000 contribution earned donors a game of golf with the president, while a $250,000 check earned access to a roundtable discussion.)

We’ll find out exactly what the White House owes Ellison later this week.

That’s when the Treasury Department will thumb through the highlights of Oracle’s proposal and make a recommendation to the president (who can do what he wants with the deal).

Now… we’re certainly no database wonk.

And we couldn’t even tell you how to get on the TikTok platform. But here’s what we do know.

The Oracle proposal does not solve the problem the president set out to fix.

Instead of giving an American firm ownership of TikTok’s dangerous data… it gives an American firm ownership of the computers that hold that data. It’s like taking the keys to a Chinese-owned warehouse and giving them to an American firm… never considering the nukes inside.

This is the kind of stuff liberty-loving, capitalism-adoring Americans must fight against. If you’re looking for your reason to go march in the street… this is it.

But most folks have no idea this sort of stuff is happening. And it’s not just this administration. Of course not. It’s been happening for generations and will continue no matter who is in charge.

The bottom line is a single person in Washington just ordered a foreign business – with large operations in the States – to divest its assets. At nearly the same time, the same person behind the order hand-picked a buddy to profit from the situation.

It makes us sick…

What’s worse is investors are rushing in to buy shares of Oracle. Shares surged by nearly 5% on the weekend’s news.

Ellison is probably already planning a campaign dinner for the next president.

The risk is worth the reward.

Dirty Money

But look around.

This isn’t about a one-off deal about national security. If this were the only instance of political meddling in our free market, we’d hop up and click our heels.

But it’s not.

It’s happening all over the place – everywhere from Big Ag and Big Defense to Big Pharma (who’s eager to get that shot in your arm before November 3).

Heed our warning.

Stay away from politically sensitive investments. They’re dangerous.

Stick a campaign slogan in your front yard. Slap a bumper sticker on your car.

But don’t let politics infect your portfolio. It’s a fool’s game.

The politicians and lobbyists will move on. But you can’t.

You’ll be stuck holding a rotting portfolio.

Tomorrow… we’ll halt our rant and show you the very best way to profit from the war for your data.

There are no politicians in sight with this one.

P.S. There’s another meeting happening in Washington today you must know about. The fallout from it could be bigger than when Nixon shocked the gold market in 1971. It could change the way you invest and spend money… Click here to learn what’s happening.

Have politics ever influenced your investment decisions? Tell us about it at mailbag@manwardpress.com.