Like Driving in a Blinding Snowstorm
An Overview by Todd Campbell April 2025
As we pass the 100-day mark of the new presidency, I wanted to update you on the current thoughts of the practice.
The Toronto Stock Exchange as of yesterday’s closing is up 0.29% year to date.1 On the US side, the S&P 500 Year to Date is -6.00% 2 with the biggest pullback in the Nasdaq at -10.06%3. These returns, while not wealth building, are in our opinion, not beyond historical situational pullbacks witnessed over the last few decades. Given the degree of uncertainty of global trading patterns, slowing economic growth and inflation concerns, these pullbacks are not alarming, nor do they cause a pivotal shift in our tenured investment process.
Trump is Driving the Snowplow
Since the inauguration, the daily change in US Federal government policy has created instability and uncertainty and has created a likeness to driving in a blinding snowstorm. There is zero visibility, and forecasting where we are on the road is practically impossible.
Consumer and business sentiment does matter regarding confidence levels to determine where to spend and invest. Stability is required and the ultimate effect on economies will largely depend on how long the snowstorm lasts. This is what we are unable to forecast. But in my personal view, it may take towards 18 months, as the political positioning for the midterm election will start to effect policy. I do expect the grass roots movement and global pushback to shorten that window of time, for the snow to clear.
Presently, it is a wait and see for President Trump to plow the road for us as he is driving the snowplow. The current economic data supports the notion that the economy is still in good shape. We are watching the data daily with great interest and intensity for opportunities and concerns.
My political viewpoint is shared in a recent article I read in The Economist quoted below:
‘If you failed to spot America being “looted, pillaged, raped and plundered by nations near and far” or it being cruelly denied a “turn to prosper”, then congratulations: you have a firmer grip on reality than the president of the United States. It’s hard to know which is more unsettling: that the leader of the free world could spout complete drivel about its most successful and admired economy. Or the fact that on April 2nd, spurred on by his delusions, Donald Trump announced the biggest break in America’s trade policy in over a century—and committed the most profound, harmful and unnecessary economic error in the modern era.’4
Be Prepared for More Volatility – Process is Critical
I continue to emphasize that volatility will be present daily. In the short term, we need to be prepared for this volatility but be comfortable in the process supported by historical market patterns. Snowstorms do stop, and when they do, the markets will advance with enthusiasm.
We remain committed to our process of buying everyday businesses that provide essential products and services and share growing dividends with us as owners. We see a lot of unrecognized value in many of our holdings, that we are confident will be rewarding to own over the next 5 or more years.
Our views on process have proven to be wealth building over my 31 years of tenure. We are not going to pivot from this process given the last 100 days. We will continue to find opportunities within this environment and remain entrenched and committed to the longer-term results. Volatility can be used as your friend to acquire and hold great businesses trading below their intrinsic values.
Cash is King for Short Term Needs
I remain confident on owning equities as the best method to build wealth over a 5 year plus cycle, but any need for liquidity over the next two years should be out of the equity markets. Given my view that it may take up to 18 months for the snow to end, we want to put on the hazard lights given the present zero visibility and park any needs for two years of cashflow in less volatile positions. If we end up in the ditch, we need some cash to pay the tow truck. We do not expect to be in the ditch, but we need to be prepared to be wrong in the short term. If you expect withdrawals over the next two years, please call and arrange for a review.
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Final Thoughts
President, RBA