The fundamental reality was reinforced by last week’s market movements: experienced investors need to be able to tune out distractions and noise.

Having dinner in Shenzhen with friends from JPMorgan and CICC, I overheard them saying that most industry insiders were expecting market instability, even while Trump and Musk were publicly feuding on X. Nevertheless, the revelation of a jobs report that was better than predicted had a direct impact on market sentiment. Despite previous market forecasts being excessively negative, this data increased optimism and caused the S&P 500 to surpass the 6,000 level.

Looking at the overall trend of the year, we can see that the S&P began around 6,000, made little gains, fell below 5,000 due to tariff concerns, and is again back where it was. Investors who painstakingly watched every policy pronouncement or headline probably lost a lot of money.

Vision for 2025: My Three Core Values

Do you recall last year when Canada was deemed unsalvageable? Recession stories were flying around, the Canadian dollar dropped to 68 cents, and politicians were quitting left and right… The Canadian dollar has rebounded to 73 cents, the TSX has been reaching record highs for straight weeks, and Q1 GDP growth surpassed 2%.

While we can’t predict what the future holds, we may look ahead to 2025 with confidence by remembering these three rules:

1. Take in news from a variety of sources, but pay closer attention to the reasoning of top-notch asset management teams (for example, the reasoning behind Berkshire’s record-high cash flow this year; my other post delves into this topic in depth)

2. “Don’t let the tail wag the dog” (don’t let a single news story dictate your long-term financial strategy) so that you don’t ruin your well-planned investment portfolio.

3. What matters most are asset values and the quality of those prices going forward.

Could We Use a Layoff?

At S&P 4,900, the risk was obviously lower than at 6,000, regardless of whether it was in February or June. Simply having low costs acts as a barrier against risk. Perhaps the most trustworthy indication in this news-explosive year is price.

When the year started, investors paid little attention to potential dangers associated with trade policy. The market continued to have faith that there will be remedies, despite the fact that tariff news had been circulating for some time prior to implementation. As we can see from the subsequent robust bounce, the market’s reaction to the tariffs was definitely excessive, as it overreacted with excessive selling when they were really applied. Markets are not necessarily rational, as these signs show.