May you live in interesting times.
I open with a well known Chinese curse (with dubious authenticity).
Who wouldn’t want to live in interesting times, why is that a curse?
Well, uninteresting means things are going pretty well.
Just like wishing someone uneventful travels. You don’t want a flight or long car drive to be eventful – boring and safe is perfectly fine.
Whether you like it or not, we live in interesting times!
The Ebbs and Flows of Politics
Each person has their own beliefs, but there are trends that can be tracked over the years.
I’m not talking one party’s beliefs. A much bigger trend.
Isolationism vs. Interventionism
The United States rose out of a hatred of imperialism and a desire to govern ourselves. That way of thinking was applied to others for the next hundred years: don’t get involved in other countries’ fights. The French Revolution, Napoleonic Wars, Crimean War, and several wars with Prussia / Russia / Ottoman Empire. Maybe we cared who won, but we weren’t about to get involved.
Then at some point in the 19th century the United States decided to be a big important country, we had to have a bit of an empire.
After the First World War, the United States shifted back towards isolationism. We did not join the League of Nations with their requirement to defend other nations. We took things further with tariffs on trade to bring the focus back home. We tightened the borders.
We stayed out of World War II until attacked. December 7, 1941 marked a new shift towards interventionism – the United Nations, rebuilding Europe, fighting communism across the world.
Then came 2016. The Brexit and Donald Trump. Did we just witness the start of another multi-decade trend? Or is this just a 4 year policy?
What is the Impact?
No one knows. And that is a little frightening.
Whether or not you agree with the new policy, we can all agree things would be much easier to predict if we kept going with the same old policy. We know more or less what that route brings us.
Predictions are often wrong though. You can’t count on knowing the future, sometimes you just have to react to what happens.
What About Money and Real Estate?
Flexibility is key. Months of living expenses saved, the ability to adjust strategies as things change.
If prices keep going up, awesome. I’ll refinance and double down.
If prices crash, that’s fine too. I always appreciate a good sale and will take advantage of my flexibility to buy at low prices.
Politics aside, how do you think about what to do with your money in the face of uncertainty?