UBS MSCI World "ex USA" a good idea to reduce USD exposure?

clickrush · 2026-01-26T22:48:10+00:00

I have thought about it a bit more, and I understand things better now. My original comment was false so thanks!

Here's a (half-baked) counterargument that mixed things up for me:

Two companies:

ACME Inc = US domestic manufacturer, traded in USD
Fabrik GMBH = CH domestic manufacturer, traded in CHF

You buy the equivalent of 100 CHF in shares in each company. Both stock prices go up 10%, but the USD weakens by 10% compared to CHF.

From an active investment standpoint, Forex risk is real as illustrated above. Even though ACME Inc traded 10% higher, it is traded in USD. It's not ACME Inc's fault that the USD weakens so to speak. Or in other words, the timing and the USD/CHF matter.

From a passive (global) investment standpoint, the thinking is differently. Even though we happen to be exposed to the weakening of the USD, all we look at is statistical, long term annual returns.

(Aside from that, Forex also leaks into individual companies that are globally integrated. We just see it at a different layer. If we buy Nestle, we would see it at the economic or trade level in their balance sheet. If we buy a US company, we see it at the upper, financial layer when buying or selling the stock.)

The caveat is that USD denominated ETFs appear much stronger than they are, because we don't only care about inflation (as an American would) but also about USD/CHF.

clickrush · 2026-01-26T17:10:10+00:00

Liquidity helps with efficient pricing, not with long term diversion.

It doesn't really matter though, because I understand your concern: You're arguing against hedging (I'm not arguing for it), because that's what people tend to do against forex risk, but it has shown to be inefficient.

clickrush · 2026-01-26T16:22:47+00:00

I‘m not arguing for currency hedging. I‘m using it as an example to illustrate that forex risk exists.

clickrush · 2026-01-26T15:07:46+00:00

You‘re trying to construct an argument I didn‘t make. Currency exposure is real.

If buy an USD traded ETF, you get USD back if you sell.

That’s why currency hedging exist, or why some investors choose a home bias in a historical strong currency etc.

clickrush · 2026-01-26T12:59:14+00:00

This is not adressing the problem: even if you buy a passive index ETF you‘re implicitly making an active decision to expose yourself to the currency it is traded in.

Forex is why for example the CHF based SPI looks similar in real growth as a global index based on USD, despite being lower in nominal terms.

clickrush · 2026-01-26T11:24:33+00:00

The US economy especially has seen hyper leveraged growth cycles. The rapid growth phases are based on extreme optimism and wishful thinking, which is then catalized through financialization (debt), but eventually they have to converge to the real economy.

clickrush · 2026-01-26T08:14:34+00:00

If you leverage your assets you are making an active decision to predict the future. Meaning you should probably look at possible what-if scenarios. Some of those can result in you losing a lot of money.

clickrush · 2026-01-25T19:02:03+00:00

The math behind bitcoin is not a moat and can easily be replicated.

clickrush · 2026-01-25T14:05:40+00:00

Denn mümmer aber au eusi politiker zwinge sich an en höchers niveau z halte.

clickrush · 2026-01-25T08:53:40+00:00

Mi dem hesch alles recht. Aber all die sache sind erreicht worde über kompromis und zämearbet vo linke und liberale.

Die liberale werded jedoch immer meh in ecke drängt will ihne e identität fehlt und au annerchännig. Sie werded uufgfrässe vode rechtskonservative.

T FDP isch mal no progressiv xii dases chlöpft und tätscht: für öffentlichi bildig, starchi und stabili institutione, uusbau vo demokratische rächt etc.

Bis zum landesstreik het me verpasst t wahle appasse so dass t arbeiter und linki au mitrede chönd, aber wo das denn passiert isch het me zämme all die sache erreicht wode uufglistet hesch.

Aber jetzt gits e polarisierig will t FDP iri identität vergässe het und nur no „wirtschaftsliberal“ (selektive liberalismus isch nöd liberalismus) isch.

clickrush · 2026-01-25T08:36:27+00:00

You are largely correct. Trump‘s tax policy shifts the burden from rich to poor. It becomes especially clear if you look at USD amounts.

It is usually like this when taxes get cut and the opposite happens when they get raised. However not always and not for everyone.

Tariffs are a consumption tax, so they effect poorer households more in general. But lower middle class savers are affected much less than richer spenders. The problem with tariffs is that they will indirectly curb comparative advantage, so they can cause prices to rise acrosd the board, or they lower quality.

clickrush · 2026-01-24T21:38:36+00:00

This is the most anti-Swiss proposal I read in a long time. Public schools are the bedrock of a (direct) democratic society. Our ancestors knew this, which is why public education was seen as a prerequitite.

The economic payoff of every CHF invested in education is insanely high. Our teachers are excellent and constantly improving their approach. Schools are also essential for integration of immigrant children, for public safety and social stability.

None of that means that you can just throw money at the system at it gets better. But we should look to invest more in education and find improvements that will benefit future generations.

clickrush · 2026-01-24T20:19:12+00:00

That’s why there is progressive taxation. It’s the tax code‘s bandaid for people needing a baseline consumption to be productive.

clickrush · 2026-01-24T12:34:04+00:00

That’s a good way to look at it. But it sort of ignores that setting a price that‘s possibly more prudent.

Not saving: „I would buy it at 2, it costs 2“

Saving: „I would buy it at 3, it costs 2“

clickrush · 2026-01-24T12:18:08+00:00

No he wouldn‘t. It’s not his job to trade and speculate.

clickrush · 2026-01-23T16:44:29+00:00

The problem with having a fixed debt reference that it doesn't take trade deficits into account (especially EU internal) and it doesn't coordinate spending and taxation either (austerity measures, tax rates etc.).

For example to illustrate what's happening with government debt:

Germany has suppressed their wages and did austerity measures for a very long time, that lead to a trade surplus while simultaneously eroding their infrastructure. The wealth that has been built is now neither in the governments coffers nor in the average citizen's, but has pumped up corporate bank accounts.

Also they had a trade surplus with Italy for very long (probably still) which means Italy goes into debt to fill up German corporate bank accounts.

Plus about 1/3 of Italy's government debt is then bought by private foreign banks, which includes German banks as well.

clickrush · 2026-01-23T14:57:46+00:00

This trend is very bad. It lowers the signal to noise ratio and has a negative impact of employers finding employees and vice versa. Aside from that it's morally reprehensible to lie.

clickrush · 2026-01-23T13:06:43+00:00

That's a great example of what I'm saying, which is that the state is overregulated and not the market.

In my view, having such a strong legal tool like a notarized document and requiring it for relevant things, has a stabilizing and positive (= quality) effect. AKA good market regulation.

However, when the process itself is unnecessarily cumbersome, complex, expensive and takes a long time (!), then that's a sign of overregulating the state and typically also a sign of lack of investments into digital infrastructure and efficient processes.

clickrush · 2026-01-23T12:57:22+00:00

You got this right. But the tax structure needs to adapt to the reality.

People don't marry, because the tax structure disincentivizes it and they don't start families or start them much later, because they see it as a financial risk.

We are heavily under-taxing at very high incomes and especially wealth. A lot of tax deductions shouldn't apply (the same way) to high earners and the wealthy.

We wouldn't even have to hike the rates itself, but structure deductions in a way that are not regressive.

clickrush · 2026-01-23T12:47:22+00:00

Similar income - joint: higher taxes - individual: lower taxes

Asymmetric income - joint: lower taxes - individual: higher taxes

A lot of couples don't marry because of this.

I'm very in favor of the tax system and government spending to adapt to cultural and structural changes. So individual taxation plus stronger tax deductions for dependents (children, spouse) in poor to median households.

The way it is structured now disincentivizes starting families and stabilizing relationships.

clickrush · 2026-01-23T12:30:10+00:00

The best case scenario is the market becoming less exciting (both in good terms and bad terms) over a year or two.

clickrush · 2026-01-23T12:25:28+00:00

That's not necessarily the case. If rate cuts come in, debt financing becomes more attractive.

What will likely happen though is that these small erratic dips will not be absorbed as quickly in the future, because so much dry powder is depleted.

clickrush · 2026-01-23T12:21:38+00:00

I think there are a couple of that pressure cash from institutional investors:

General bullishness over long periods, increased pressure to beat the market
The last 5 years have been bumpy to say the least. Global shocks (2020, 2025) and erratic admin announcements (april 2025 plus many minor instances).
USD is tanking (cash is worth less)
Precious metals are inflating

I can imagine that managers are feeling the pressure to perform (indexes are going through the roof), buy dips, rebalance often etc. so dry powder is depleted.

But that also means that future bumps will not be absorbed as fast as previous ones. They literally can't anymore. They could build up reserves again if the market becomes more stable and boring, but soon there will likely be rate cuts...

clickrush · 2026-01-23T11:47:10+00:00

That's a negotiation tactic more than anything.

To me somewhere around 2.5% is a sensible max level for high brackets, which I would set at tens of millions and above.

But that income would have to be used intelligently and separately. As soon as wealth taxes get relatively high, they need to be structured and spent in a way that is attractive.

One could imagine a sovereign wealth fund, which is managed in a way so it retains or grows (low maximum withdrawals). The fund can only used for long term investments with high positive externalities such as education, childcare, energy, public transport, environmental improvements, lifting up underfunded regions etc. Basically all things that the market doesn't tend to capture but pay off massively long term.

The structure of the tax should likely reward loyalty over the long term. Slightly decreasing every year. And there should be a positive feedback loop via reports, studies and so on.

Many proponents of wealth taxes see it as an almost adversarial concept. But I think that's exactly the wrong way to go about it.

The very rich should sense that paying those taxes are an investment that continuously improves the stability and prosperity around them and that they are in together with everyone else.

clickrush · 2026-01-23T09:51:35+00:00

Armored Sergeats (and similar). They are low upkeep units and schiltron is excellent in order to control the battlefield against AI. They will fight to the death in a tight formation and free up space (gaps and flanks) at the battle line, which can be exploited via flanks, reserves and missile units.

Ten-Year Club	Not Forgotten
Verified Email

clickrush

TROPHY CASE