The Diary of a pessimistic charity investor
22 December 2024 (written with a sigh)
Sat staring at the markets, which stared back in that unblinking way peculiar to screens and fate. Christmas is approaching. Trump approaching faster. Wars ongoing, expanding, or at least refusing to behave themselves. Ukraine grinding on. Gaza aflame. Diplomacy issuing statements. Markets issuing price signals of indifference.
I ask myself, as a responsible steward of charitable capital must: Is this really the moment to be invested?
Inflation has supposedly been tamed, though prices in the real world remain unconvinced. Central banks speak in riddles. Bonds have recently rediscovered their purpose but seemed eager to relapse. Equities feel too artificially intelligent, buoyed in a way that felt morally inappropriate. Some call this a bubble.
The imminent inauguration of President Trump (again) adds to that familiar seasoning of constitutional anxiety, trade-war nostalgia, and late-night social media risk. One cannot not help but wonder whether markets are complacent, insane, or merely American.
I consider selling for cash. I always consider cash. Cash feels virtuous. Cash also famously does nothing.
(I wrote in the margin): “Protect capital. Avoid embarrassment. Remember: this is charity money.”
Then I did what all pessimists do when paralysed by responsibility: nothing decisive.
22 December 2025 (written with mild surprise)
Well…
Looking back over the past twelve months, the world did not end. Nor did it improve in any tidy or cinematic way. Politics remained theatrical. Wars remained tragic and unresolved. Headlines remained convinced collapse was imminent.
Markets, meanwhile, did what markets always do: They lurched, recovered, ignored morality, priced narratives, then moved on.
Equities rewarded optimism and punished hesitation, particularly in places involving technology, artificial intelligence, and anything described as “transformational”. Bonds behaved themselves more often than expected, occasionally even earning their keep. Cash, loyal and inert, preserved capital with monk-like discipline and monk-like returns.
Volatility arrived on schedule, departed early, and was monetised by people younger and more confident than the rest of us.
The charity did not suffer. Nor did it become embarrassingly rich. In retrospect, this was a success.
The most alarming realisation was this: The things I feared most turned out to be background noise, while the things I barely noticed did most of the work.
What Was I Thinking? I was thinking that uncertainty was new. I was wrong.
I was thinking markets should reflect the emotional state of the world. They do not.
I was thinking caution was the same as prudence. It isn’t, at least not on its own.
Most of all, I was thinking my job was to predict outcomes. It is not. It is to remain invested while being wrong in manageable ways.
What should be done for the charity’s Investments in 2026?
Stay invested, unapologetically. The charity exists in the long term. Its money should too. Selling fear is easy. Buying resilience is harder and more effective.
Diversify like someone who’s been embarrassed before. Equities for growth. Bonds for ballast. A little cash for sleep.
Accept volatility as rent, not risk. Volatility is the price of admission, not a sign you’re in the wrong building. Avoid grand macro bets. Presidents, wars, and policies matter, but rarely in the neat, investable way forecasts imply.
Remember the purpose. This capital is not there to win arguments at trustee meetings. It is there to fund spending, quietly and repeatedly.
Maybe I should take a leaf out of Daniel Kahneman’s book “Thinking, Fast and Slow”, where he says optimists are sunnier, more positive and their problems smaller and more solvable. They are more popular and have more friends.
(I wrote in the margin): I remain pessimistic. It’s a comfort. But the portfolio sensibly diversified and left mostly alone, continues to be optimistic on my behalf. Which is, on reflection, exactly how it should be.