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The Big Beautiful Bill, Social Security, and Your Investment Strategy
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June 2, 2025 | Season 7 | Episode 21
The global investment landscape may be approaching a pivotal shift after 15 years of US market dominance. While American markets have delivered exceptional returns, mounting evidence suggests international opportunities deserve renewed attention from investors seeking to optimize their portfolios.
At the heart of this potential transition is a stark contrast in fiscal trajectories. Since 2000, the US debt-to-GDP ratio has skyrocketed from 33% to over 120% – a staggering 90 percentage point increase. This massive expansion of government debt likely fueled economic growth and market performance, essentially "borrowing from the future" to prime the economic pump. Meanwhile, countries like Germany, Canada, and numerous others have maintained more disciplined approaches, with many actually reducing their debt burdens over the same period.
This divergence creates an intriguing investment thesis. Countries that have demonstrated fiscal restraint now have greater flexibility to increase infrastructure and defense spending, potentially creating more favorable investment conditions. Germany's trillion-dollar commitment to these sectors represents a significant departure from previous austerity, while other regions may benefit from shifting trade relationships amid US-China tensions. Early indicators support this view – while the S&P 500 has gained approximately 1.5% year-to-date, international indexes have surged about 14%.
Beyond global allocation strategies, this episode explores practical considerations for retirement planning. Despite political uncertainty surrounding Social Security, mathematical analysis confirms that delaying benefits until age 70 provides superior returns compared to commercial alternatives. With a 9.6% higher payout rate than comparable annuity products, the financial advantage of waiting remains compelling for those who can afford to delay.
Curious about how these global economic shifts might impact your portfolio? Consider whether your current asset allocation reflects these emerging opportunities and challenges. Have you reviewed your international exposure lately? The next decade of investing may look quite different from the last.
** For informational and educational purposes only, not intended as investment advice. Views and opinions are subject to change without notice.
For full disclosures, ADVs, and CRS Forms, please visit https://heroldlantern.com/disclosure **
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Chapters
1. May Market Review and Tariff Impact (00:00:00)
2. US Deficit History and Global Comparison (00:08:20)
3. International Investment Opportunity Shift (00:18:00)
4. Market Updates and Economic Indicators (00:24:18)
5. Social Security Claiming Strategies (00:29:00)
6. University Endowments and Private Equity (00:32:55)
7. Target's Challenges and Pharmaceutical Potential (00:38:24)
233 episodes
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