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carl-delfeld

Carl Delfeld

Chief Analyst, Cabot Explorer

Carl Delfeld is a member of the Cabot investment team, and chief analyst of Cabot Explorer.

He received his Masters in Law and Diplomacy at the Tufts Fletcher School; worked for the First National Bank of Boston (now Bank of America) in London, serving as director of the Japan and South Korea Group; served as vice president at the investment bank Robert W. Baird & Company, developing new business in Tokyo, Hong Kong and Sydney; was Asia advisor to the U.S. Congressional Joint Economic Committee, the U.S. Finance Committee and the U.S. Department of the Treasury; wrote for Forbes Asia and the Far Eastern Economic Review; served as a member on the U.S. National Committee on Pacific Economic Cooperation and the Japan-U.S. Friendship Commission; was chairman of the Asian Pension Forum and wrote a book, titled, Red, White & Bold; the New American Century.

From this author
In a tough week for markets, Explorer stocks held their own. Banco Santander (SAN) shares are up 50% so far in 2025, significantly outperforming bank and European indexes. Luckin Coffee (LKNCY) was up 10% this week and Sea Limited (SE) shares have risen 25% rise so far this year. All our dominating stocks held firm this week.

It was interesting to be in Tokyo and meeting for lunch today with a former Japan Ministry of Finance official as new tariffs of 24% on Japan were announced.
The “Great Rebalancing” will see money flow from overheated U.S. markets to international markets. It’s already underway, but it’s just getting started.
The growing global middle class should bring immense profits to emerging market consumer companies. “Taipans,” the new tycoons, are already investing in them.
I’m in Japan this week as Warren Buffett indicated that his Berkshire is raising its stakes in Mitsubishi, Marubeni, Mitsui, Itochu and Sumitomo. Berkshire’s average holding across the five stocks increased by just over one percentage point to about 9.3%. This comes as financial pundits continue to determine the meaning of why Berkshire has accumulated a massive cash position.

Perhaps Buffett is betting that America’s share of global equity indices may be close to peaking at almost 70%.
Investing in monopolies is a good way to make money. But it can be difficult for U.S. investors. Where to find them? Start overseas.
Moat stocks are shares of companies with powerful economic advantages over competitors. They’re also a favorite of legendary investor Warren Buffett.
Before we get to an update on my journey through Asia, let me offer a few thoughts regarding recent market weakness and volatility, driven by rising economic and political uncertainty. Sea Limited (SE) bucked the trend with another strong quarter while American Superconductor (AMSC) shares had another tough week after a great run, down 15.8%.

The tariff on-and-off news is creating some turbulence as are the pivotal Congressional spending and tax negotiations.
As global workforces shrink due to aging and population changes, automation will need to pick up the slack. These two robot stocks could benefit.
This week I’m in Cebu, Philippines. While in a shopping mall I spent a couple of hours analyzing a fascinating situation whereby Samsung, Apple and Huawei stores were right next to each other.

I’m not technically proficient enough to tell you which company and product offer the best value, but Huawei’s lower end smartphone was only $450 and seemed to offer everything anyone would need. Its high-end leader was just slightly cheaper relative to Apple’s most recent model, with all the bells and whistles. The store was very polished and in no way seemed to be of lesser quality to Apple or Samsung.
Switzerland is an economic powerhouse, and putting some high-quality Swiss stocks in your portfolio is a timely hedge against overexposure to U.S. equities.
Emerging markets are a great investment, but frontier markets have even higher growth potential. Here are seven reasons they’re not as risky as you think.
Nvidia (NVDA) has been a huge recent winner, but Costco (COST) boasts a dominant business model, which is why Costco stock is the better long-term investment.
While Nvidia (NVDA) has pulled back more than 20% over the past two weeks, our conservative AI play IBM (IBM) has tacked on 40 points over the same period- hitting an all-time high early this week.

Cloudflare (NET) shares were up again this week and are now up 28% in 2025 to reach 140.

Dutch Bros (BROS) shares rose 8.5% this week and have surged 23% so far in 2025.
The Trump Administration is off and running along with Cabot Explorer stocks as markets closely watch the potential for tariffs on Canada, China, and Mexico.

Mexico and Canada are America’s two largest trade partners, and both countries are bracing for major economic disruption should Trump follow through. Mexico and Canada send about 80% of their exports to the U.S. Market turbulence in stocks based in Mexico or Canada could create an opportunity for us.
As the world races to combat global warming, it will need nuclear power to do it. And these three nuclear energy stocks should benefit.
Markets were closed yesterday in honor of the late President Jimmy Carter.

No matter your politics, the service was well done and inspirational.

It was a solid opening this first week of 2025: new recommendation American Superconductor (AMSC) shares were up 10%, Centrus Energy (LEU) shares were up about 8%, Cloudflare (NET) shares were up 7.5%, and Dutch Bros (BROS) shares were up 7.3%.
It’s a busy and short Christmas week and like many of you, I was doing last-minute shopping and preparing to visit family.

Therefore, this is a brief update and instead of the usual stock-by-stock update, I can summarize as follows.
I recently noticed a few popular stocks such as MicroStrategy (MSTR) offering exposure to leveraged Bitcoin which to me seems like excessive risk and a sign of potential trouble.

This is like pouring gasoline on a roaring fire. It reminds me of a quote from Edward Chancellor’s book The Price of Time, which offered this gem:

“……as a rule, panics do not destroy capital; they merely reveal the extent to which it has previously been destroyed by [the taking on of excessive leverage in good times].”
New technologies are making nuclear energy much safer and more efficient than before. And nuclear stocks are benefitting.
Centrus Energy (LEU) shares jumped almost 19% this past week and are up 70% in the last six months. Dutch Bros (BROS) shares gained 6.3% this week following weekly gains of 10.6% and 36%.

Tariffs took center stage this week as the incoming Trump administration indicated day-one 25% tariffs on Canada and Mexico and some more for China as well.
You could make an argument that Taiwan Semiconductor (TSM) has become the most important company in the world. Here’s why.
The rally since the election continues as Bitcoin reached $90,000 for the first time. Tesla (TSLA) has climbed more than 40%, and the KBW Nasdaq Bank Index, which tracks shares of some of the nation’s largest lenders, is surging.

Dutch Bros (BROS) shares jumped 36% this week as it beat analysts’ expectations on the top and bottom lines while offering improved guidance for the remainder of 2024. Sea Limited (SE) soared 10.3% as the Singapore-based company reported overall net income that beat estimates at $153.3 million, with a better-than-projected 31% rise in revenue for the September quarter.
We need to begin with some bad news. Super Micro Computer (SMCI) stock tumbled 32% yesterday after its audit firm, Ernst & Young, resigned. The auditor said it had recently learned of information “which has led us to no longer be able to rely on management’s and the audit committee’s representations, and to be unwilling to be associated with the financial statements prepared by management.”
Bill Gates has already invested more than $1 billion in the future of nuclear power, and as interest in the energy source grows, these stocks look to have bright futures ahead.
Bank stocks such as Morgan Stanley (MS) and Goldman Sachs (GS) had strong earnings while tech is starting to show signs of weakness. ASML (ASML) reported sharply lower quarterly sales and giant Samsung Electronics’ share price (listed on the Korea Exchange) has fallen almost 30% over the past six months as it struggles to catch up with SK Hynix and Micron in supplying the most advanced AI chips.

Still, everyone is waiting for Nvidia’s (NVDA) earnings as capital spending in AI remains robust.
China’s benchmark CSI 300 index has surged 25% in the five days following Beijing’s stimulus measures to unleash its economy and financial markets. This has led to some catch-up growth for Explorer stock and fund recommendations.

The action was not limited to just Chinese stocks but also stocks looking to China for growth. I mentioned commodities last week, but another winner was the luxury business.
The Chinese economy is stronger than it’s getting credit for, but is it strong enough to make shares of China’s largest Internet and consumer stock Alibaba (BABA) a buy?
The Federal Reserve has voted to lower interest rates by a half percentage point, the first since 2020 and more than many expected. The overwhelming Fed board vote suggests more rate reductions are likely this year. This Fed move was clearly already baked into markets but keep in mind that the Fed only controls overnight interbank interest rates. Nevertheless, this action will help support the market and boost interest rate-sensitive stocks such as real estate and utilities.
Small-cap stocks can offer a lot of potential opportunities, and these two international small-cap ETFs can help you round out your portfolio.
Given recent market volatility, it’s time to refocus on managing portfolios and reducing stock investing risk. These tips will help.