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Articles by Jasmine

Jasmine Yeo

Fund Manager

12 February 2026

Voters rarely forgive governments on whose watch their purchasing power erodes. Over the last two years, political incumbents across the developed world fell victim to the same tide: almost no party survived the inflationary hangover from the early 2020s. And Donald Trump helped ensure the Biden administration was undone by the cost-of-living crisis.

Now, with price pressures eased, Trump faces the irony of owning the inflation problem – self-inflicted through an aggressive round of reciprocal tariffs which have created (at least the perception of) fresh price increases.

The result is a disgruntled electorate and poor approval ratings. As he heads into the November mid-terms, the President finds himself navigating a K-shaped economy: asset owners flush with gains, the rest left behind.

This month’s chart suggests voters are already feeling the economic pain. It tracks US equities (relative to their five year average) and US consumer sentiment over half a century, but instead of showing raw levels it measures how many standard deviations each series is from its historic average.

As you might expect, consumer sentiment has typically tracked the highs and lows of the stock market. However, despite the S&P 500 rocketing to successive new all-time highs, consumer sentiment has cratered since Trump’s 2024 victory. The University of Michigan consumer sentiment reading is currently languishing more than 50% below its late 1990s peak (another famous stock market high).

It is a chart of two Americas. The public narrative writes itself – artificial intelligence is destroying jobs and driving up electricity costs, while boosting the stock market. Home ownership is pushed out of reach.

The mid-terms may well define Trump’s presidency. He needs to lift consumer sentiment without reigniting prices – a fine line to walk.

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Stimulus cheques, public spending drives, housing support, renewed tariffs, geopolitical brinkmanship and pressure on the Federal Reserve to lower interest rates have all been floated as remedies. Each could deliver a sugar hit to voter confidence but, taken too far, risks upsetting investor sentiment or undoing hard won disinflation.

And Trump can’t decree prices lower. The recent proposal to cap credit card interest shows how limited his levers are. Ironically, one thing that might genuinely depress prices would be if his tariffs were struck down in court. Imagine a president quietly hoping his own flagship policy is invalidated by the judges he loves to loathe.

The mood in Washington is triumphalist after recent geopolitical successes, notably in Venezuela. Buoyed by momentum, the administration appears poised for bolder moves. Whilst investors have so far cheered the administration’s giveaways, the UK’s recent experience and the reaction to Japanese Prime Minister Takaichi’s proposals, show how quickly markets can rebel when generosity overshoots prudence.

We believe Washington will continue to run the economy hot, juicing growth and perhaps asset prices for a while longer. But, given already solid growth, election-winning policies risk unanticipated market and inflation volatility.

This wouldn’t be the first time inflation’s second act was written in Washington. History shows that price pressures tend to come in waves, often triggered by political impatience.

At Ruffer, our goal is straightforward: to own a collection of assets that, together, can deliver meaningful returns whether markets prove benign or otherwise. Around a third of the portfolio sits in global equities, focused on sectors likely to benefit from lower borrowing costs and pre-election stimulus. Should 2026 veer away from the Goldilocks scenario, the portfolio is well protected through a range of inflation hedges that include precious metals and commodities exposure, as well as our holdings in the yen, and equity and credit derivatives. In combination, these positions should allow us to prosper whether the year brings steady ascent, overheating or renewed weakness.

As Jonathan Ruffer’s long‑standing philosophy reminds us, true resilience lies not in predicting the timing of the next crisis, but in being prepared for it.

Articles by Jasmine

Jasmine Yeo

Fund Manager

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Piers Wheeler

Director – Institutional

T +44 (0)20 7963 8258

Developing and executing asset management strategy for capital raising and strategic relationship management. Coverage includes EMEA, Asia and Australia. Piers joined Ruffer in 2021, having previously worked with asset management firms including Eastspring, AMP Capital and LEK as a strategic consultant. He holds a MA from the Bayes Business School and a BA (Hons) from the University of Oxford.

Annabel Paterson

Senior Associate – Institutional

T +44 (0)20 7963 8123

Joined Ruffer in 2021, having graduated with a first class honours degree in land economics from the University of Cambridge. After two years working with the UK Private Wealth team and completing her IMC and CFA Level I qualifications, she now supports Ruffer’s global business development and client servicing efforts.

Articles by Annabel

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