Nov 5, 2026 · 9 min
Investors weigh earnings against elections and geopolitical shocks
Viewpoints with Burkhard Varnholt - A global markets podcast (Ep. 76)
The episode frames market resilience as a test of whether fundamentals can outweigh political headlines, technology weakness, crypto risk, and shifting bond expectations.
- 1Strong earnings with lower valuation multiples can support a healthier bull market than rising prices alone.
- 2China’s technology weakness reflects economic and profit pressures more than a failure of artificial intelligence.
- 3Falling Treasury yields suggest bond investors see a more manageable path for productivity, inflation, and interest rates.
Don't miss
Varnholt turns the episode’s many risks into a concise investing formula: quality assets, a strategy, diversification, and less reaction to news.
The brief
Dan Cassidy and Burkhard Varnholt open with a market shaped by U.S. midterm elections, technology weakness, crypto risk, geopolitics, and bonds—but argue earnings and interest rates matter more than political headlines.
Varnholt describes a bull market pulled between fear of missing out, fear of exiting, and fear of being obliterated, while strong earnings and lower valuations offer a healthier foundation.
China’s technology sell-off, a major crypto theft, and possible North Korean links shift the discussion from artificial intelligence to profits, cybersecurity, trust, and geopolitical risk.
Falling 10-year Treasury yields suggest bond investors are less alarmed about inflation, debt, and deficits, and more accepting of productivity and moderate inflation.
Varnholt’s closing formula is deliberately simple: own quality assets, follow a strategy, stay diversified, and do not let the news make investment decisions.
What was said on this episode
21 statements · 11 positive · 7 negative · 3 neutral
Markets are rising because election results reduced uncertainty.
“Markets are up today because they prefer clarity over uncertainty.”
Listen at 1:00
Earnings and interest rates primarily drive Wall Street.
“what's driving Wall Street is always the same thing, the same two things, earnings and interest rates.”
Listen at 1:07
Great companies generate earnings through innovation and customer sales.
“They're made when great companies innovate and sell to happy customers.”
Listen at 1:14
Earnings, inflation, and interest rates matter most to markets.
“earnings, inflation and interest rates.”
Listen at 1:33
Corporate earnings generally drive markets more than political headlines.
“while politics drive headlines, bottom lines usually drive markets.”
Listen at 1:36
S&P 500 forward earnings rose 31% during the year.
“the S&P 500 forward earnings this year are up 31%.”
Listen at 2:53
The stock market’s price-to-earnings multiple declined 14%.
“While the stock market's PE cheapened by 14%.”
Listen at 3:03
A declining stock-market valuation multiple is healthy.
“this cheapening is healthy.”
Listen at 3:12
Bull markets generally remain healthy while earnings continue rising amid investor concerns.
“as long as earnings keep climbing a wall of worry, the bull is usually doing fine.”
Listen at 3:16
China’s STAR 50 Index declined 40% over four months.
“the stars 50 index is down 40 percent over the last four months.”
Listen at 3:42
China’s technology sell-off is driven more by economic weakness than AI failures.
“That's probably more driven by China weakness than by AI failures.”
Listen at 3:49
Many Chinese companies prioritize market share over profits.
“many companies prioritize market share over profits.”
Listen at 4:02
Chinese companies sacrifice profits and export deflation through low-priced goods.
“Many Chinese companies sacrifice profits. They're exporting deflation.”
Listen at 4:10
Chinese authorities will provide stimulus and encourage companies to prioritize profits.
“There'll be government stimulus. Don't wait too long. They will re-emphasize profits.”
Listen at 4:29
The Chinese stock market could reverse rapidly.
“this market can turn around very quickly.”
Listen at 4:37
The crypto heist undermines trust in digital payments.
“it undermines trust in digital payments.”
Listen at 5:36
Chinese-bank assistance to North Korean hackers could unsettle regional détente.
“That could unsettle the recent entente between Washington, Beijing, and Pyongyang.”
Listen at 6:00
Bond markets are less concerned than several months earlier.
“the bond market just seems a little less worried than it was a few months ago.”
Listen at 6:32
Bond markets can sometimes detect major shifts before other observers.
“Bond markets can sometimes spot a seismic shift before anyone else does.”
Listen at 6:59
Bond investors are accepting a favorable productivity, inflation, and interest-rate outlook.
“they're really accepting our Roaring Twenties view about productivity, inflation, and well-behaved interest rates.”
Listen at 7:10
Investors should own quality assets, follow strategy, diversify, and ignore news-driven decisions.
“Own a few good assets. Stick to your strategy. Stay diversified. Don't let the news make decisions for you.”
Listen at 7:50
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.
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