With a widening trade war against China in response to US President Donald Trump's aggressive trade tariff proposals, U.S. stock markets have plunged into chaos—losing $7.7 trillion before recovering partly—provoking a tide of fear, tactical repositioning, and global diversification among America's high-net-worth individuals, the Wall Street Journal reported.
From selling stocks to going liquid: risk reduction on the rise
In Warwick, Rhode Island, businessman Chris Ciunci unloaded shares exposed to tariffs, such as Nike and Applied Materials, and shifted some holdings into cash. Ciunci complained of increased inflation and stagnant growth, labelling recent U.S. economic policy a departure from the market stability of previous times. "Now, I feel my portfolio is in the hands of an individual," he said, worrying about Trump's influence on economic outcomes.
Calm amid chaos: some investors hold steady
Conversely, Doug Johnson, a onetime private banker in the Denver area, was unflustered. Holding a diversified portfolio and long-term investment perspective, Johnson concentrated on investigating summer vacation arrangements rather than responding to short-term market fluctuations. He still searches for worldwide investment opportunities but retains a U.S.-centric focus based on the legal system and liquidity benefits of the country.
Rethinking U.S. dominance: global diversification gains ground
Ultra-high-net-worth family advisers such as Rich Scarinci of Partners Capital and Monica DiCenso of JPMorgan indicated growing client interest in diversifying out of U.S. equities. Investors are increasingly weighing exposure to European and Japanese markets, foreign currencies, and fixed income, asking whether America's prevailing investment story can persist in a deglobalizing world.
Buying the dip: Trump loyalists spot opportunity
Despite concern, others did see opportunity. Ken Wagnon, a retired 86-year-old Pizza Hut franchisee and die-hard Trump fan in Kansas, used the market sell-off as an opportunity to add to U.S. stock holdings. Spurred on by Trump's assertive tariff approach, Wagnon issued fresh buy orders, confident in the market's long-term strength and the administration's pause to give way to global negotiation.
Balancing patriotism and preservation
Nevertheless, the uncertainty has stoked existential questions for U.S. markets. While analysts caution against the dangers associated with single-leader-imposed policy changes, families worth hundreds of millions are actively reconsidering where and how to place their capital—weighing patriotism and preservation.
Stay the course or look abroad? A pivotal moment for investors
UBS has encouraged high-net-worth clients to remain invested, citing past records that reflect the S&P 500 has bounced back with high returns each time it has fallen 20% since 1945. Yet for most investors, talk has moved from tactical action to more profound issues about the future of U.S. economic leadership.
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