The World Votes And Keeps On Turning

"Elections are a time of focused unintelligence," said the former mayor of Vienna, Michael Häupl, back in 2005. This rings just as true in the US as it is does here. The Muppet Show just has a bigger audience.

One thing is a given: political events have a short shelf life in the markets. 

In any case, the financial markets took a relatively relaxed view of the US elections. No major event was reflected in the movement of share prices. And why should there be? Entrepreneurs and companies carry on with their business every day, regardless of who wins the race for the presidency. If you want to survive in economic competition, you have to play with the political cards that are dealt to you.

Of course, businesspeople are allowed to get upset about political decisions, to protest against them or even support campaigns financially. But at some point, their own business comes to the fore again and they concentrate on what truly matters. That's what we do at Gutmann when we invest. 

What counts for us is the success of individual companies. 

Share prices react to factors like profits, cash flow, growth, margins and returns on capital. That is our world. In the Gutmann Chief Investment Office, we focus on the things we can assess. 

Competitive advantages, balance sheet quality, management, growth prospects and the like are difficult to assess. But these considerations are important for the share price. They determine the long-term trajectory and development of a company. 

Political events, on the other hand, are mere short-term waves whipped up by the storm. They deserve our attention, but we will always maintain our well-planned course with a steady hand.