January Charts and Links

Here are some of the writings that caught our attention this past month:

1. Ben Carlson provides his favorite performance chart, an asset allocation quilt:
   
2. As seen above, foreign stocks had a terrific 2025, while bonds, thanks to rising rates, have been the worst performer over the past ten years. In contrast, large caps have had an excellent decade. Carlson also provides a chart suggesting that large cap performance may be at or near peak, but even if there is reversion back to historical norms, the timing of any such large cap cooldown is unpredictable:
   
3. Noah Smith argues that batteries, electric vehicles, and solar power represent an ongoing technological revolution, and that while China is embracing these technologies, the US is lagging.
4. James Pethokoukis, citing Goldman Sachs research, argues that AI will not decimate the labor market, and that the benefits of AI will outweigh the pains from labor market shifts.
5. Raj Shah and Christopher Hirchhoff argue that the US military needs to invest in drones with much greater urgency than it’s shown so far.

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This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument or investment strategy. This material has been prepared for informational purposes only, and is not intended to be or interpreted as a recommendation. Any forecasts contained herein are for illustrative purposes only and are not to be relied upon as advice.