How Trump Teaches Us Patriotism – EU Stocks on the Rise
The US stock rally of recent years was too tempting to resist. Everyone could consider themselves a genius in investing, as almost all US stocks performed well.
That things can go differently has been evident for a few weeks now. In particular, Trump’s tariffs, dubiously justified by the “fentanyl crisis,” are unsettling many.
US Administration Still Aggressive
As observed during the meeting with Zelensky, Trump and his team are not yet done with their highly unorthodox behavior. The election has been won, and approval ratings will not matter as much for nearly the next four years.
Only in the midterms, the US congressional elections in November 2026, will public opinion become important again. Until then, in the next 18 to 19 months, a lot of damage can be done without fearing consequences.
Investors Nervous About US Tech Stocks
It is noticeable that the highly praised US tech stocks are suffering the most. Just as they previously outpaced all others, they are now the first and hardest hit.
On the other hand, the proportions remain roughly the same. Alphabet (Google) still has a strikingly low price-to-earnings ratio of around 20, while Palantir, even after heavy losses, still carries a hefty P/E ratio of nearly 500.
The Myth of a USA Exploited by the World
For a political and thus economic assessment of the US administration’s arguments:
The USA is not a victim but a beneficiary of the current global system. The dollar’s status as the world’s trading currency is particularly advantageous. The US can print dollars and, in this way, reduce its debt.
Foreign aid, often framed as unnecessary and useful for political grandstanding, is neither a major expense nor purely altruistic. It usually comes with political influence or favors (e.g., voting alignment in the UN assembly) and is tied to concurrent or future economic agreements. Additionally, it helps prevent issues like epidemics or rising refugee numbers.
According to the OECD, in 2023, the USA spent only 0.24% of its Gross National Income on foreign aid—about 1/400 of its total. Germany spent 3.42 times more (0.82%), while Norway spent 4.54 times more (1.09%).
Unlimited Power Encourages Risk-Taking
The US administration’s plan appears to be to create facts with a firework of measures and test the limits of what is possible.
Resistance seems minimal, perhaps because many believe that the Supreme Court, known for being favorable to Trump, will ultimately approve everything.
While the Supreme Court recently blocked US foreign aid cuts with a narrow 5:4 ruling, it is unlikely to do the same for larger future initiatives.
DAX and Euro STOXX 50 on the Rise
US investor forums are increasingly discussing European stocks. The DAX and European stocks are soaring, with Friedrich Merz’s multi-billion package further fueling enthusiasm.
Now is a good time to take a closer look at domestic stocks. Telekom, Siemens, SAP, Allianz, and Munich Re have been performing well, even before Trump, and are now seeing even greater demand.
However, European defense stocks have already overheated at the time of this article’s publication.
Gold as an Anchor in Turbulent Times?
Gold, known as a crisis-resistant asset, is becoming even more interesting. Physical gold is not necessary, as storing small amounts in a safe deposit box incurs disproportionately high costs.
As a non-physical gold investment, Exchange Traded Commodities (ETCs) like Euwax Gold II or Xetra-Gold are recommended.
Real Estate as a Perennial, Crisis-Proof Investment
No matter how turbulent things get, a property entry in a German land registry keeps you on the safe side.
Rents rise with inflation. Housing is a basic need and has always been scarce in Germany and many other industrialized nations.
Real estate offers three types of returns: value appreciation, rental income, and tax benefits through depreciation potential.
Property transfers within families enjoy tax advantages.
Banks are relatively willing to finance real estate, enabling the leverage effect, which boosts return on equity.
We are happy to advise you on real estate investment. At Meine-Renditeimmobilie, we always deal with entire property purchases, including a notary and land registry entry—traditional and transparent. We buy properties ourselves, and you buy directly from us, without intermediaries or broker fees.