In Investing, No One Beats The Averages - Except The White House

Last week, President Donald Trump released his standard disclosure form, OGE Form 278-T (two parts). All members of the Executive Branch are required to release this form quarterly, and the President complied. What these forms revealed is simply astonishing; some things are so out of the ordinary that they require us to take another look.

After spending over half a century on Wall Street and watching the investment results of multiple thousands of investors, I’ve never seen anything that approaches the record the President set during Q1, 2026. It was something no other everyday investor has ever achieved.

In the past, the President has disclosed that he does not make investment decisions; that’s left to other members of his family, chiefly his eldest sons, Donald Jr. and Eric. However, neither of the two sons has a background in the kind of stock trading that is occurring in their father’s account. During the first quarter alone, the President’s account recorded over 3,500 trades — an unheard of level of trading that is never seen in a private individual’s investment account.

During my career, I have worked for what was then the largest Mutual Fund Company and the second-largest money market mutual fund. The number of back-and-forth trades is reminiscent of the type of activity one would see in those large funds. It’s an activity level appropriate for a fund company with billions in assets under management. Not an individual’s account that is worth (only) millions. It’s an order-of-magnitude difference. So, the first red flag in the President’s investment activity is the level of activity, which is far beyond what is considered appropriate for a man nearly 80 years old, much less for someone who holds public office.

It leaves open the question of who might be making this many frantic trades. Two Cabinet members have the requisite background: Howard Lutnick and Scott Bessent. However, it is unlikely that Lutnick, whose background is in bond trading, would suddenly switch to equities. Both the mechanics and the culture of these two types of trading are very different. Long-term bond traders do not normally become overnight day traders; it’s simply not in their DNA.

It follows then that Scott Bessent, of all the members of the Cabinet, would have the requisite background to manage such a level of trading activity. He was, after all, the manager of a Hedge Fund, just the sort of investment fund which normally has this kind of trading profile.

In 2015, Scott Bessent launched Key Square Capital Management with $4.5 billion in investor capital. At the time, the largest hedge fund “nest egg” ever accumulated for a startup. Unfortunately, over the next eight years, Bessent’s fund lost 90% of its value and was forced to close in 2023, just before President Trump appointed Bessent as Secretary of the Treasury.

We can’t help but notice that Bessent’s track record and President Trump’s are opposites. While Bessent was forced to close a hedge fund due to poor performance, the President seems destined to have outstanding results. For more than a week now, dozens of analysts and financial writers have combed through Trump’s account in a vain attempt to find a significant losing position.

On the other hand, Trump has made remarkable gains in this trading, doubling his money in investments in Dell Technologies, AMD (Advanced Micro Devices, Inc.), and Intel Corporation.

While most financial professionals would advise against the rapid trading that the President is doing. Perhaps it’s paying off for investor Trump. After all, he had the foresight to purchase Nvidia just before the Government approved its sale of chips to China, to purchase Axon just before the US Immigration and Customs Enforcement (ICE) Agency announced a large purchase of Axon’s Tasers, and to purchase Intel just before the Federal Government approved Intel’s acquisition
of TikTok’s domestic assets.

Put all this frantic activity together, and the President’s portfolio grew by $12.7% during the first quarter. Not bad for 90 days.

Inflation Fever

I confess that I’m as susceptible to Inflation Fever as anyone, and perhaps more than most. That’s because I’ve lived through high-inflation periods before, like the 1970s. Now, Inflation fever is the overwhelming urge to buy something before its price goes up. You may recall that I recently purchased the propane I use to heat the house, before I thought the price was rising.

It may be a wise strategy if it saves a couple of dollars, but it could become a dangerous trend if the entire country starts thinking that way. In fact, that’s just what happened 50 years ago, and it’s exactly what made fighting inflation so difficult.

A report published this week indicates this may be happening all over again. I’m referring to the Advanced Report on Durable Goods Produced, published by the Census Bureau. It is a monthly report, and for April, it showed a 7.9% increase. Over the last 15 years, this report ranks among the top 5 most significant.

A durable good is an item that lasts for some time, such as an automobile, a large appliance, furniture, or electronics. The fact that consumers and businesses decided to purchase these high-ticket items in April may indicate that the “buy before the price goes higher” attitude, or inflation fear.

Reinforcing this inflation-driven mentality were the twin reports on personal income and personal spending. Income was absolutely flat, no gain. At the same time, Personal spending increased by 1/2%, likely due to higher, inflation-driven prices for day-to-day goods and services.

Ok, so here’s a mind twister — Corporate Profits. The headline reads: Corporate Profits fell by 0.4% from the previous period. That’s not correct.

Corporate profits in Q1 were $40 billion, down from $247 billion the quarter before. In other words, corporations are still making money, just a lot less than last year. Profits fell by 83% in Q1 — companies made only 16% as much as in Q4 2025.

Of all the economic reports, this is probably the most important because it is the fundamental value that drives stock prices. It is the “E” in the Price-to-Earnings equation. Lower corporate earnings are a bad indicator, but negative earnings would be a disaster.

I’m frankly surprised that this report hasn’t garnered more attention than it has — this is a very big deal.

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