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Maybe It Is Time For A New Investment Strategy

May 03, 2021 6:59 PM ET12 Comments
John M. Mason profile picture
John M. Mason


  • The political world has changed, the alignment between the parties has shifted and it appears that this has resulted in a shift in the way the Biden administration is working.
  • Now, in order to regain voters it believes that it has lost, Mr. Biden and the Democratic party are stepping up spending efforts to directly benefit the voters lost.
  • But, the spending effort directed in this way will impact the economy in a totally different way than past policy efforts  and this will impact how investors should invest.
  • Therefore, investors are going to have to analyze the new government policy efforts and see how they must adjust their investment strategies to best take advantage of the new structure.

Coming to a fork in the road surrounded by lush green grass
Photo by fivepointsix/iStock via Getty Images

For the past sixty years, investors in the United States came to be dominated by basically one investment strategy.

That strategy was buy and hold and not fight the Federal Reserve.

During this

This article was written by

John M. Mason profile picture
John M. Mason writes on current monetary and financial events. He is the founder and CEO of New Finance, LLC. Dr. Mason has been President and CEO of two publicly traded financial institutions and the executive vice president and CFO of a third. He has also served as a special assistant to the secretary of the Department of Housing and Urban Development in Washington, D. C. and as a senior economist within the Federal Reserve System. He formerly was on the faculty of the Finance Department, Wharton School, the University of Pennsylvania and was a professor at Penn State University and taught in both the Management Division and the Engineering Division. Dr. Mason has served on the boards of venture capital funds and other private equity funds. He has worked with young entrepreneurs, especially within the urban environment, starting or running companies primarily connected with Information Technology.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (12)

Abel+ profile picture
Wait, Biden had voters?
Maybe it's time you retire.
With Senator Manchin refusing to bow to budget reconciliation to fund infrastructure and ‘families plan’ largesse, talk is just that ~ talk.
Thank you. Great timing. I look forward to continue following you as you assess the best way to modify investment strategy. M
I find all the projections by "reputable economists", or newspaper opinion writers, or any politician, to be mostly mambo jumbo that has got very little to do with reality. The reality is that as situations occur, adjustment are made, and as adjustments are made, the results are nowhere close to the original projections; it is a dynamic situation, continuously evolving. I am somewhat disappointed by this opinion article as it only focused on the doomsday scenarios, but did not theorize a counter-opinion about what would happen if nothing is done.
Wait what? The spending is X -- but the "true" cost of the spending is 3X?

Sorry, but that sounds like the motivated reasoning of tax cuts that pay for themselves.

Fun fact: The corporate tax cuts of 2017 and the additional deficit spending that came with it injected some $1.1 trillion of new demand into the economy over the first three years of the past Administration. That is the equivalent of some 5.5% GDP over three years and it created zero new economic growth. Annual GDP growth for that period was some 2.5%. Not noticeably different from the 2.6% GDP growth in the three years before.

That evidence seems to suggest, the the real cost of taxation does not matter as much as some people seem to think.
FDR took us out of the 19th century.
Biden is trying to take us out of the 20th century
This nation needs to start thinking forward not backwards!! I think what Biden is proposing is a good thing for our children and making our nation’s future. We can’t keep falling behind places like Japan in modernizing our railways and technology. All we’re doing now is showing off the mega billionaires we have and still living with dated technology. I would love to know which investments and strategies are recommended by the article contributor because I truly didn’t see much regarding that. I only read a lot of complaining about how much this will cost.
@TOPSTOCKS21 Biden is *hardly* thinking about the best interest of your children. Indoctrination is more like it.

This ain't your daddy's Democrat party, that's for sure. Or even ours.
"This ain't your daddy's Democrat party, that's for sure. Or even ours".
I agree. I'm old enough to remember when the Democrat party was for the "little guy" and blue collar workers/unions instead of all this upper income, higher educated class "woke" bull you-know-what. So in that regard what Biden, or more likely, his advisors are doing is a definite and interesting change back to the way the old Democrat party used to be.
hawkrnc_19 profile picture
The best article on SA in a long time.
Thank you for the article.
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