Excess Returns The Monumental Miscalculation | Jared Dillian on Tariffs, Fed Risks, and Where Markets Go from Here
Apr 26, 2025
Jared Dillian, the contrarian economist behind the Daily Dirt Nap newsletter and host of the Macro Dirt Podcast, dives deep into the current market landscape. He argues that tariffs may actually be deflationary, challenges the notion of a strong dollar in the long run, and shares insights on the shift towards international stocks. Dillian also discusses his unique investment strategy—an 'Awesome Portfolio'—and the risks of protectionism while highlighting the evolving importance of social media in gauging market sentiment.
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Manage Position Sizes in Volatile Markets
- Reduce position sizes when market volatility is high to manage risk effectively.
- Trade conviction levels should reflect probability and expected value, avoiding overly concentrated bets.
Use and Rebalance an Awesome Portfolio
- Diversify your portfolio across stocks, bonds, cash, gold, and real estate for balanced risk and inflation exposure.
- Rebalance annually to maintain target allocation and benefit from trends effectively.
International Stocks Outlook Positive
- International stocks are undervalued compared to US stocks and likely to continue outperforming.
- The dollar's potential decline supports investment opportunities outside the US.