The Chaos Immunity Report

Have Markets Learned to Stop Worrying and Love the Madness?

Markets Commentary

Tariff Tango Continues. ‘Sell in May’ myth busted with the S&P 500 having its best May in 35 years.  

Desensitization and the New Market Psychology

Remember when markets used to care about things? Those were quaint times. Back in April, investors were losing sleep over tariff threats, trade negotiations, and geopolitical tensions. The S&P 500 initially dropped out faster than your Wi-Fi connection in the middle of a movie.

But here's the plot twist: by July, we weren't just back – many markets were hitting record highs while simultaneously juggling more uncertainties than a circus performer.

Our view is that over the years humans have demonstrated their adaptability and market makers are (almost) human. The media – humanity debateable – are finding it increasingly difficult to hype the financial shock and horror with most of us zoning out.

What we're witnessing is evolutionary adaptation; markets have developed what psychologists might call "learned resilience" - the ability to not just survive chaos, but thrive in it.

SUMMARY

Don’t panic Mr Mainwaring. Happily, we are not day traders and the message is to ignore the noise and keep an eye on the long term and (try) to remain calm, historically this has proven to be the best approach. 

p.s. Desensitization is something that most of us who have kids have undergone for years – if only to avoid going around the twist. As the old Stingray series used to open with – ‘anything could happen in the next half hour’.

p.p.s. Our compliance department has caught up with us: This newsletter is for informational purposes and should not be considered personal financial advice.