To The Moon

My Investing Muse (17 Mar 2025)

Layoffs & Closure news

Indonesia’s layoff crisis deepens as factories shut; growth hangs in the balance Rising costs and cheap imports hit manufacturing sector hard; other industries are also bleeding jobs, though for different reasons - Business Times SG

Alibaba's Tsai discusses AI's potential: 'Research analysts can be completely replaced' - CNBC

Employees at PwC, Deloitte, EY, and KPMG are bracing for layoffs as the consulting sector deals with economic volatility, decreased demand, and client prioritization of core expenses. - Techgig

These are just several of the many F&B establishments which have pulled the plug recently. Five of seven F&B tenants in the National Gallery Singapore will be ceasing operations. October last year also saw one-Michelin-starred Sommer exiting the local dining scene. - Timeout Magazine (Singapore)

The Dickey's Barbecue Restaurants chain has not filed for bankruptcy, but the company's franchisee Smokin' Dutchman Holdings filed for Chapter 11 protection in September 2024, blaming its financial difficulties on Dickey's for allegedly imposing extreme and unreasonable demands on the debtor's resources. - The Street

The above are some snippets of news about layoffs and closures in the past week. There seems to be more of such news in recent weeks. Widespread retrenchment is one of the early signs of a market correction.

Some relief for the market

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The S&P 500 adds over $1 TRILLION of market cap and officially posts its best day of 2025. - X user The Kobeissi Letter

Before we start turning bullish, there are some interesting cues from top investors like Buffett and Dalio.

Should we be cautious like some of the top investors?

Here is some news that leans me towards a cautious posture.

What can we learn from the world's top investor - Mr Buffett / Berkshire?

This clip from the interview reaffirmed the view that Trump is WILLING to weather a recession. When asked if he "sees a recession this year," he responds, "I would hate to predict something like that." He says, "It will be great," but knows there will be short-term pain. - X user The Kobeissi Letter

Billionaire investor Ray Dalio says that the U.S. won’t ‘be competitive in manufacturing with China in our lifetime.’ - X user Unusual Whales

Hedge funds' unwinding comes at a time when leverage in the industry is at a record level. A Goldman Sachs note showed overall hedge funds' leverage in equity positions was at 2.9x their books, a record level over the last 5 years. - Reuters

The above considerations have guided me to a more cautious outlook for the coming weeks.

My final thoughts

Given the news above, we can afford to be more cautious. With some of the top investors exercising caution, we can take more time to qualify the opportunities that we have identified. There is a chance to make money but we can always afford more due diligence.

Tension is boiling within the cities as waste has been uncovered. This has led to job cuts, a freeze on funds, and much concern as thousands of federal workers find themselves without a job. Protests and reactions aimed at Trump and Musk have followed. With more scheduled audits, will there be more “unrest”?

No trade can also be a good trade.

It is time to consider our available options, including reviewing our expenditures, income, and savings. Let us spend within our means, invest with what we can afford to lose, and avoid leverage.

Let us do our due diligence before we take up any positions. Here is wishing you all a successful week ahead.

@TigerStars

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