๐ Market Insights: US Shutdown, Buffett Indicator & Chinaโs Challenge
๐ฐ This week brought several headlines that sounded dramatic at first glance. But a closer look shows the picture is more nuanced.
๐ US Government Shutdown
The US government entered a partial shutdown due to political deadlock. Historically, such shutdowns have only a negligible economic impact. Markets remain calm so far, with only short-term volatility risk.
๐ Buffett Indicator
The US market cap-to-GDP ratio hit 217%. While media often call it the โBuffett Indicator,โ Warren Buffett himself only mentioned it once more than 20 years ago. The ratio tends to rise over time and should not be viewed as a universal overvaluation metric. Relying solely on it would have cost investors significant gains.
๐ China vs. Europe
Chinese automakers are rapidly expanding in Europe thanks to low prices, heavy subsidies, and fast innovation. The EU is considering tariffs and quotas on Chinese steel โ but such measures only buy time. Europeโs competitiveness will ultimately depend on innovation and lowering high energy costs.
๐ Market Performance as of Oct 2, 2025
US equities (1 week): +1.2% in CZK
Dividend equities (1 week): +1.0% in CZK
YTD 2025: US equities โ1.8%, dividend equities โ6.2%
Since 2020: US equities +103.3%, dividend equities +36.8% in CZK
โ My view: Headlines may sound alarming, but for long-term investors, fundamentals and innovation matter most. Thatโs why I continue to combine both growth and dividend stocks that make sense for my strategy.
Sincerely,
๐๐ข๐๐ก๐๐ฅ ๐๐๐ง๐ข๐๐๐ค ๐ ๐๐ก๐๐ฆ๐ฉ๐ข๐จ๐ง ๐๐จ๐ฉ๐ฎ๐ฅ๐๐ซ ๐๐ง๐ฏ๐๐ฌ๐ญ๐จ๐ซ ๐
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Sat Nov 08 2025 06:15:03 GMT+0000 (Coordinated Universal Time)
