Thoughts from Themes: Positive Anything is Better than Negative Nothing

The Power of Positive Thinking (1952) by Norman Vincent Peale is a self-help classic that emphasizes the transformative impact of optimism and faith on personal and professional success. Peale argues that a positive mindset can overcome obstacles, reduce stress, and attract favorable outcomes. Key principles include belief in yourself, positive visualization, imagining successful outcomes to build motivation and resilience, faith and affirmations, being action-oriented, and maintaining optimism.

Peale’s core message is that by focusing on possibilities rather than limitations, individuals can unlock their potential and navigate life’s difficulties with hope and determination.

In today’s volatile stock market, headlines scream about tariffs, trade wars, and economic uncertainty, sending speculators and investors into a spiral of fear. Since the end of February, the broader indexes have suffered massive swings, up and down, and pundits continue to focus on the "uncertainty" that constantly circulates the news. Yet, inspired by Norman Vincent Peale’s classic read, it may be time to look beyond the noise and seek opportunities in this volatility.

Volatility isn’t the enemy—it’s a canvas for opportunity. Peale’s call to replace worry with action resonates here. Investors who dwell on tariff headlines miss the bigger picture: companies adapting to new realities, supply chains shifting to favor local production, or emerging markets gaining traction. For instance, data from Bloomberg in Q1 2025 showed U.S. industrial ETFs outperforming global indices by 8%, a trend that savvy investors caught early.

The market rewards those who, as Peale suggests, “expect the best.” Instead of fearing tariffs, look for the winners—firms with pricing power, innovative strategies, or exposure to growing domestic demand. Channel Peale’s optimism: affirm your ability to adapt, visualize long-term gains, and act with confidence. In a world obsessed with negatives, the power of positive thinking isn’t just a mindset, it’s a strategy for thriving in chaos.

A Look at The Positives:

Gold and gold mining stocks have experienced a significant surge in 2025 amid heightened market volatility driven by geopolitical tensions, trade uncertainties, and economic shifts. Gold prices have soared, reaching record highs above $3,500 per ounce (Bloomberg), fueled by its status as a safe-haven asset during turbulent times. Key drivers include escalating U.S.-China trade tensions, with tariffs intensifying market instability, and robust central bank buying, particularly from China and emerging markets, as a hedge against financial sanctions and inflation. Unlike traditional patterns where rising interest rates suppress gold, its price has climbed alongside a strong dollar, reflecting a shift in investor sentiment viewing gold as insurance against systemic risks.

According to Bloomberg, Gold mining stocks have outperformed broader markets, with the Solactive Global Pure Gold Miners Index and stocks like Newmont and Barrick Gold posting substantial gains. Miners benefit from operational leverage, where rising gold prices significantly boost profit margins, as production costs remain relatively stable. For instance, miners’ margins are estimated to be 35-40% higher in Q2 2025. Despite a 70% rise in 2025, miners remain below 2020 highs, suggesting room for growth. However, risks persist, including potential corrections if speculative fervor cools or macroeconomic conditions stabilize. Investors are drawn to gold’s low correlation with other assets, reinforcing its role as a portfolio diversifier, while miners offer leveraged exposure to gold’s rally, albeit with higher volatility. 

In 2025, market volatility driven by geopolitical tensions, trade policy uncertainties, and shifting economic conditions has also created compelling investment opportunities in large financial institutions. Despite a rocky start to the year, with the S&P 500 briefly entering correction territory due to tariff fears, financial stocks have shown resilience, outperforming broader markets with a 2.5% gain year-to-date, led by major banks. Analysts, including those from Schwab, have issued "buy" recommendations, citing attractive valuations and robust earnings potential. Financials are trading at a discount compared to historical norms, making them a value-oriented opportunity amidst cyclical sector selloffs.

Several factors bolster the case for investing in big financials. Anticipated deregulatory policies under the new U.S. administration are expected to spur mergers and acquisitions, boosting deal flow and capital markets activity. Goldman Sachs forecasts a 25% increase in M&A activity in 2025, benefiting broker-dealers and investment banks. Additionally, a steeper yield curve and a shallower Federal Reserve easing path provide tailwinds, enhancing net interest margins for banks. We expect strong corporate earnings, particularly in financials, to grow significantly, supported by increased commercial lending and cost-cutting measures.

However, risks remain, including potential trade shocks from tariffs and heightened market sensitivity to policy changes and investors are advised to focus on high-quality, large-cap financials with strong balance sheets to weather volatility. With solid fundamentals and policy-driven catalysts, large financial institutions present a strategic investment avenue for navigating turbulent markets, offering both growth and defensive attributes.

Bitcoin has also demonstrated remarkable resilience amid market volatility, despite global economic uncertainties and trade tensions. Its decentralized nature and fixed supply have solidified its appeal as a hedge against inflation and currency devaluation, particularly as central banks maintain loose monetary policies. Unlike traditional assets, Bitcoin’s low correlation with equities offers portfolio diversification, attracting both retail and institutional investors. Crypto innovation further enhances investment opportunities. Layer-2 solutions like the Lightning Network improve transaction scalability, while

decentralized finance (DeFi) platforms expand access to lending and yield farming, rivaling traditional financial systems. Emerging projects in Web3 and tokenized assets are on the horizon as well.

This Week's Major U.S. Economic Reports & Fed Speakers (Time in EST)

MONDAY, APRIL 21          

10:00 am   U.S. leading economic indicators  

TUESDAY, APRIL 22          

9:30 am  Philadelphia Fed President Patrick Harker speaks        

2:00 pm  Minneapolis Fed President Neel Kashkari speaks        

2:30 pm  Richmond Fed President Tom Barkin speaks        

WEDNESDAY, APRIL 23          

9:00 am  Chicago Fed President Austan Goolsbee opening remarks        

9:30 am          STL Fed President Alberton Musalem, Fed Governor Christopher Waller speak  

9:45 am  S&P flash U.S. services PMI for April    

9:45 am  S&P flash U.S. manufacturing PMI  

10:00 am   New home sales for March    

2:00 pm  Fed Beige Book        

7:40 pm  Atlanta Fed President Bostic speaks        

6:30 pm  Cleveland Fed President Beth Hammack speaks        

THURSDAY, APRIL 24          

8:30 am  Initial jobless claims for April 19    

8:30 am  Durable-goods orders for March    

8:30 am  Core durable orders (business investment) for March      

10:00 am    Existing home sales for March    

5:00 pm  Minneapolis Fed President Neel Kashkari speaks        

FRIDAY, APRIL 25          

10:00 am   Consumer sentiment (final)

Investment Themes

Last week, Big Tech earnings reinforced that AI is still the biggest priority and opportunity in the marketplace and that the investment in all things AI is in full force. Tesla, Alphabet, IBM, ServiceNow, and others confirmed that they will continue to build and invest in artificial intelligence and even with recent uncertainty around tariff negotiations between the US and the world, AI momentum continues to build. We expect to get more clarity this coming week when Amazon, Microsoft, Apple, and Meta release their earnings reports. The numbers to focus on will be revenue, earnings and continuing investment in AI. Regarding guidance, we think investors will allow some grace while the world figures out global trade dynamics, but "intentions" for a positive outcome are critical to keeping investors optimistic.

MSFT is expecting to report strong earnings on the back of robust sales and bookings for its cloud service AZURE on the back of growing demand for AI services. Looking deeper into the number will be the percentage of revenue generated from AI through its cloud business, which has increased each of the last two quarters.

Meta’s advertising revenue will be scrutinized when Meta reports after the market closes on Wednesday, specifically around ad spend from large Chinese companies that have been affected by the tariff standoff with the US. Investors are concerned that many Chinese companies have cut off or severely decreased ad spend, as well as US companies that have seen rising costs because of implemented tariffs or the uncertainty swirling around negotiations. Meta sold off in Q1 and any clarity around continued capex spend will help to reassure investors that they are positive about growth for the remainder of the year.

AAPL has had a rough quarter with all the tariff noise and uncertainty, especially because its supply chain and iPhone production are so heavily reliant on ease of trade with China. And even though smartphones and other electronics have been exempted from the tariff talks for now, investors are concerned that iPhone sales and production could take a big hit. Tim Cook is known as an operational expert and he and his team will be put to the test on AAPL's earnings call this coming Thursday. Clarity around production and sales, or at the very least, an explanation of a clear plan to avoid production and delivery delays, will be necessary for investor confidence.  

AMZN has always benefited from size, scale, and operational excellence, often at the most difficult times in the market. It's possible that in this tough time of tariffs and supply chain uncertainty, AMZN can potentially outperform again regarding its e-commerce and digital retail and delivery business. AMZN also has one of the more diversified revenue streams among the Mag 7, which should help balance results. Strong results in cloud entertainment, and advertising as well as the development of its proprietary chips will be seen as positive compared to its competitors.

HOOD got hit hard last quarter along with the rest of the market as the broader indexes took a hit and investors became more cautious, taking to the sidelines. It also suffered from a decrease in the price of Bitcoin and crypto-related assets and scrutiny around its gaming platform. However, HOOD benefits from all transactions, both on the buy and sell side and with the recent recovery in the markets, HOOD has a chance to show resilience as it continues to grow the number of investors on its platform and the number of transactions.   

AMD is coming off a very disappointing earnings call and the share price has suffered over the last quarter, making its valuation on a P/E basis more attractive on average than other names in the Nasdaq 100. That could lead to a surprise to the upside if they can show that they are growing their GPU market share and maintaining their CPU prowess, specifically in the AI and datacenter space.  They have been positioning themselves to compete with Nvidia in the GPU and datacenter market, and with tariffs exempting semiconductors, AMD could be attractive ahead of its earnings call on May 6th.

Bitcoin's rebound during uncertain times is yet another proof point of mass adoption and its store of value characteristics in any type of market. The rebound above 95K at the close of the broader markets, this past Friday (4/25), shows that investors believe in BTC as an asset class, a store of value, and a high growth opportunity. During a very volatile period for the broader markets, bitcoin remained steady and traded orderly. We expect BTC to continue its march to new highs as the year progresses with potentially substantial gains up to 150-200K by year end. Gold took a bit of a hit this past week after soaring to new all-time highs, but the upward trend is still in play as investors continue to worry about the US dollar, which thus far has fallen more than 4.5% in April, marking its largest monthly drop since late 2022. Much of this is due to global uncertainty about trade and as that continues, we expect gold and BTC to continue to go to new highs.

Disclosures:

All data sourced from Bloomberg as of 27 April 2025

Views expressed in this newsletter are the current opinion of the author (Paul Marino). The author’s opinions are subject to change without notice. Information contained in this report was received from sources believed to be reliable, but accuracy is not guaranteed. Past performance is not indicative of future results. Investing always involves risk and you may incur a profit or loss. No investment strategy can guarantee success.

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Solactive Global Pure Gold Miners Index is a financial index that tracks the performance of global companies primarily involved in gold mining. It includes the largest and most liquid gold mining companies, with companies needing to derive at least 90% of their revenues from gold mining to be eligible for inclusion.