Barefoot’s survival guide to Trump, tariffs and our own election circus

Trump’s trade war is more political theatre than policy and Australia’s own election circus isn’t far behind. Here’s how Barefoot Investor’s keeping his sanity.

Scott Pape is the Barefoot Investor. Picture: Jason Edwards

“What’s the deal with Trump’s tariffs? What does it all mean?” my editor Wally texted me this week.

“It doesn’t mean anything”, I shot back.

Clearly, that wasn’t the response he wanted (it was, in fact, a story idea masked as a question).

Now, for the record, I think Trump’s tariffs are like setting your house on fire to keep burglars out – they’ll cause higher prices, mass job losses, and very likely a recession. Which explains why The Wall Street Journal called it “the dumbest trade war in history”.

So should you worry about what this could potentially do to your portfolio, or for that matter property prices?

Relax, Trump is as likely to go ahead with these trade tariffs as he is to officiate a gay marriage at the Mexican border.

So … what is really going on?

Well, his former adviser Steve Bannon famously explained the Spray-Tan Sultan’s strategy:

“The real opposition is the media. And the way to deal with them is to flood the zone with sh! t.”

And that is precisely what the President is doing. And we’ve got another four more years of this.

Worse, this year we’re having our own political beauty pageant in Australia, starring Peter Dutton, as Trump’s way less entertaining understudy, and Anthony Albanese, who blends Biden’s energy with the puffball platitudes of Kamala.

I’m tired of this sh!t already.

Look, overdosing on the political news cycle is kind of like checking your stocks each day. Constantly monitoring your portfolio feels like you’re doing something important and responsible – but most of the time, you’ll be much more likely to make kneejerk, emotional decisions like freak out and sell … at just the wrong time. Instead, focus on the long term, that’s what really matters.

So let me tell you what I’m doing this year:

I like my news the same way I like my wife’s voicemails: highly detailed, kind of boring, and full of annoying facts. Sure, I’ll be keeping informed, but I won’t be obsessively checking the political news every hour, and I’m not on social media.

US President Donald Trump, Australian Opposition leader Peter Dutton and Prime Minister Anthony Albanese.

Instead, I carry a physical book with me. And whenever I am bored – which is often – I pull out my book and read a few pages. Mentally this gives me the exact opposite feeling of clicking on the ‘breaking news’ alert, or whatever Zuck’s algorithm is trying to hook me with. I finish the day feeling productive, thoughtful and happy. And when I set the book down I look at my new bookmark and feel like I’ve achieved something.

So, which book should you read?

Read whatever floats your boat! Though perhaps don’t read Donald’s The Art of The Deal. After all, Trump not only didn’t write the book, he’s apparently never even read it. His ghostwriter, Tony Schwartz (who famously described his effort as “putting lipstick on a pig”), says Trump had way too short an attention span to read.

Tread Your Own Path!

Should I ditch AustralianSuper

Hi Scott,

I’ve been a fan of yours since my dad introduced me to you 20 years ago. On the weekends he would read your article in the paper out loud. Now I’m 26 years old (do you feel old?) and I’m writing to you because I’m worried about my super. I’m with AustralianSuper and lately they’ve had some stuff-ups. They lost $1 billion on a private equity deal, and this week it was reported they invested $500 million in Nvidia right before it crashed! Their returns haven’t been great, so I’m wondering what you’d suggest I do.

Chris

Over the long run, low-cost index funds outperform professional fund managers 8 times out of 10, says Scott Pape.

Hey Chris,

First up, let’s get one thing straight:

AustralianSuper is the nation’s largest super fund, and they manage over $355 billion of retirement savings of over 3.4 million members. In other words, their portfolio is so huge that a couple of financial fireballs aren’t going to be so much as a cinder to their overall returns.

Yet this is what’s always baffled me about the super industry:

Why are they even trying to pick winners?

The evidence is crystal clear – index investing works. Over the long run, low-cost index funds outperform professional fund managers 8 times out of 10.

And, the more money you have to invest, the harder it is to beat the market. Just ask Warren Buffett – he hasn’t outperformed the index in 20 years. His advice? Stick with index funds.

So here’s the choice that super funds are making:

Invest in ultra-low-cost index funds, or trust our team of ‘experts’ (who collectively cost hundreds of millions in salaries each year) to pick investments for you.

But here’s the catch:

These experts have only a 2 in 10 chance of beating the index over the long term. And to cover their wages they’ll have to charge you nine times more in fees than the index funds.

Who in their right mind would take that deal?

Answer: almost every major super fund in the country.

That said, I don’t mind AustralianSuper, especially their low-cost index offerings.

Oh, and say g’day to your old man for me.

ChatGPT is an environmental DISASTER!

Scott,

Did you know that every AI query chain (5–50 questions) burns through 500ml of water? That’s half a litre per chat – just to cool the servers! I’m no greenie, and I think the war on cow farts is ridiculous, but isn’t it ironic that the same crowd pushing climate agendas is building tech that guzzles water?

You’ve got a massive audience – this is the kind of fact that makes people think. Next time someone lazily asks AI instead of figuring it out themselves, they should picture pouring a bottle of water straight down the drain.

Carol

A reader tells Barefoot that an AI query chain (5–50 questions) burns through 500ml of water.

Hi Carol

Right now I’m sitting here on my farm. The paddocks are so dry and the dirt is so cracked it reminds me of my grandmother’s heels (bless her). Six months ago, these rolling hills were lush and green. Now? My sheep are on the ultimate low-carb diet.

So I get it. And I also get the hypocrisy of our tech overlords. However, when it comes to water consumption, I think we all tend to live in glass greenhouses.

Carol, I want you to do me a favour: please stretch out your hands.

Is there a gold ring on your finger?

That one bit of bling consumed upwards of 30,000 litres of water.

Now scan down to your feet: your leather shoes consumed around 16,000 litres of water (which of course, is why I’m Barefoot).

And that chocolate bar you inhaled on the couch last night?

1700 litres.

Heck, even a book sucks up 7000 litres when you factor in printing and paper production.

And you know what that means, don’t you, Carol?

It means that I am personally one of the biggest environmental disasters in the history of this country. Adam Bandt should stick a warning label on my noggin and ban me from ever writing another book again!

Hello Miss Barefoot

Hi Scott,

My daughter is an absolute boss!

She is up to Step Three of your Barefoot Kids book and is beyond enthusiastic. The jars are filling, there’s no end of parent-pleasing (yes!), and she’s already negotiated her first pay rise. Thanks for writing such an engaging kids’ book.

Charlie (Barefoot Mum)

Charlie’s daughter with her Barefoot Kids book.

Hi Charlie,

Oh that melts my heart.

Of all the books I’ve written, it’s my kids’ book that makes me feel the most proud.

Your daughter is going to grow up with the belief that she’s good with money. That she’s kind and generous and a hard worker. How awesome is that?

DISCLAIMER: Information and opinions provided in this column are general in nature and have been prepared for educational purposes only. Always seek personal financial advice tailored to your specific needs before making financial and investment decisions.

Originally published as Barefoot’s survival guide to Trump, tariffs and our own election circus