The Year of Perpetual Change - Greenland Edition

Just 2 short weeks ago, we sent out a letter discussing how 2025 was the Year of Perpetual Change with at least 7 different major government policy events acting to delay corporate and consumer decision making and effectively stunting economic growth.

As we make our way into the office this morning, 2026 has started in a similar vein. Today’s distraction revolves around Greenland and the full force push to bring it under U.S control. Hopefully, this turns out to be a similar tactic as many of last year’s policy decisions - take an extreme position to settle on something more reasonable. In this case, greater military presence and perhaps some mineral deal. My guess and hope is that is where we end up. The alternative would likely have negative but manageable economic consequences but my main concern would be geopolitical as it would severely fracture the Western Bloc and would likely strengthen China and Russia’s global position.

Based on the assumption that the current extreme position moderates over time, we are not advocating for any large positioning changes. Of course, every client’s circumstances may differ.

In the meantime, we are seeing markets react across the globe. The U.S dollar is falling on concern about U.S. standing as a reliable partner. U.S and European equities are declining due to new tariff concerns and general concern about a stunting of economic activity. Also, importantly, Japanese bond yields are rising as investors take a risk-off posture which is reducing the so-called “carry” trade. The impact is also causing U.S.  bond yields to rise - exacerbating the drop in U.S. equities.

To reiterate, I do suspect positions will moderate but wanted to give you an explanation of some of today’s market behavior.

This commentary is for informational purposes only and does not constitute investment advice or a recommendation to buy or sell any security. Views expressed are current as of the date published, subject to change, and there is no guarantee that any market outlook or forecast will be realized; investment decisions should be based on individual circumstances.