If you’re a California resident managing assets, planning your estate, or protecting family wealth, understanding how political uncertainty affects your investments isn’t just academic—it’s essential to preserving what you’ve built. Recent developments in U.S. foreign policy and trade relations are creating unprecedented volatility that could impact your portfolio, estate values, and long-term financial security.
What California Families Need to Know About Current Political Risk
January 2026 marked a significant shift in how investors view U.S. assets. According to recent reporting from CNBC, heightened political risk has become the backdrop for U.S. stock markets following several destabilizing events:
These actions have strained relationships with key allies in the European Union, Britain, and Canada, creating what experts call a “massive source of uncertainty” for anyone holding U.S.-based assets.
How Are International Markets Outperforming U.S. Investments?
The numbers tell a compelling story for diversification. In January 2026 alone:
For California families with significant wealth in U.S. equities, this performance gap raises important questions about proper asset allocation and geographic diversification.
Why Is the U.S. Dollar Weakening and What Does It Mean for Your Estate?
The U.S. dollar dropped more than 1% in January and sits 11% below its 52-week high. This matters for estate planning because:
If you’re planning to leave assets to heirs or considering international property, currency fluctuations can significantly affect the real value of your estate over time.
What Investment Experts Are Recommending Now
Stephen Kolano, Chief Investment Officer at Integrated Partners (managing approximately $24 billion), describes U.S. strategic policy as creating both actual and “mental risk premium” around trade routes and diplomacy. His firm expects this uncertainty to persist for at least the next three years.
Meanwhile, investment strategists are pointing to specific alternatives:
Marko Papic of BCA Research suggests investors consider a “buy the rest of the world” trade rather than simply “selling America,” noting that even if the S&P 500 performs well, double-digit currency declines could erase gains for those holding only U.S. assets.
How Will Political Risk Affect Estate Planning Through 2029 and Beyond?
Paul Christopher, head of global investment strategy at Wells Fargo Investment Institute, believes geopolitical risk could remain elevated even after Trump’s second term ends in January 2029. For California estate planners, this means:
The Federal Reserve Factor: What Kevin Warsh’s Nomination Means for Your Assets
Questions about Federal Reserve independence add another layer of complexity. Kevin Warsh, nominated as the next Fed chair, would start his term in May if approved by the Senate. Markets initially responded positively, viewing Warsh as independent and committed to fighting inflation, causing gold and silver prices to plummet on the announcement.
However, Matthew Aks of Evercore ISI warns that the Fed transition represents “another very serious vector” for concerns about U.S. political risk.
Regional Differences: How Asian Allies View U.S. Assets Differently
Not all international investors are reacting the same way. Large pension funds in Japan, given extensive security ties with the United States, may not embrace the “sell America” trade as readily as European counterparts. This suggests that political risk assessments depend heavily on:
What This Means for California Probate and Estate Planning
If you’re managing California-based assets or planning your estate, these developments create specific challenges:
For families who value transparency and want to protect what they’ve built across generations, working with experienced estate planning professionals who understand both legal structures and financial market dynamics has never been more important.
Protect Your Family’s Wealth Despite Political Uncertainty
At California Probate and Trust, PC, we help California residents navigate complex estate planning challenges while protecting family assets through market volatility and political uncertainty. Our Sacramento-based team offers:
We understand that political risk, market volatility, and family protection can feel overwhelming. That’s why we offer a free one-hour consultation to help you understand your options and create a plan tailored to your specific situation.
Schedule Your Free Estate Planning Consultation Today
Don’t let political uncertainty put your family’s financial security at risk. Contact California Probate and Trust, PC at (866)-674-1130 or visit cpt.law to schedule your complimentary consultation with our experienced estate planning attorneys.
Legal Disclaimer
This article is provided for informational purposes only and does not constitute legal, financial, or investment advice. The information contained herein is based on publicly available sources and represents general observations about market conditions and political developments. Individual circumstances vary significantly, and readers should not rely on this article as a substitute for professional legal or financial counsel. California Probate and Trust, PC does not provide investment advice or management services. All estate planning strategies should be developed in consultation with qualified legal and financial professionals who understand your specific situation. Past market performance does not guarantee future results. No attorney-client relationship is created by reading this article or visiting our website. For personalized legal guidance regarding your estate planning needs, please schedule a consultation with our firm.
Source: CNBC – Political risk: How Trump 2.0 is affecting investment in U.S. assets