Treasury Secretary Scott Bessent is arguably the biggest stock-market cheerleader in American political history. And that fact is throwing a floor under stocks in a way few people realize.
It’s another reason to buy stocks now—or better still, stock-focused closed-end funds (CEFs). Because when things get rough, we can count on Scott to temper policies that might otherwise ruffle the markets.
This sounds like a minor thing, but it’s key in a market like this, which I see as still having room to run, even though, yes, valuations are getting stretched.
The Stock Market Indicator
To get at the moderating effect of Bessent’s presence, we need to start with President Trump, who has a long history of caring about the stock market, even though his career was in private real estate.
While presidents have tended to downplay the stock market, or outright ignore it, Trump remained keen on stocks for many years, tweeting about the markets at many points prior to, and during, his first term.
So when Trump won the election late last year, many expected his focus on stocks to continue. This is partly why stocks tanked following Trump’s unveiling of massive tariffs in April, as many commentators started wondering whether he had lost interest in the stock market as an indicator of presidential success.
“This time around, Trump may not care about market dives,” wrote CNN. That narrative didn’t last long—Trump’s reversal on tariffs after markets took a nosedive gave us the TACO acronym: “Trump always chickens out.”
Stocks Soar Out of the “Tariff Tantrum”
And since then, well, stocks have been doing well. Yes, that’s partly because earnings growth is strong, as we discussed in last Thursday’s article. But it’s also because investors realized they’d discounted Trump’s indifference to stock prices when, in fact, he still cares a lot.
Bessent Goes to Bat
Trump hasn’t explicitly said his administration wants stocks to surge, but quite recently, Bessent did exactly that.
“We want the most America-first policies that are possible, without incurring market wrath,” said Bessent in a recent interview with the Financial Times, suggesting that a downturn in stocks will cause both him and his boss to step back if they go in a direction markets don’t like.
Later in their chat, Bessent told the FT, “I have a healthy regard for the market,” while emphasizing that it is precisely this concern that distinguishes Trump’s administration from others that have tried a radical overhaul of trade agreements. “What gets people in trouble is they come in, they have these ideas, but they don’t respect the market … you’ve got to respect the market.”
An administration official expressing such a bullish view is unusual. But having a bullish attitude is not. Nor is it a Republican-only thing.
In the early 2010s, President Obama reappointed Ben Bernanke as chairman of the Federal Reserve, and his quantitative easing program of the time resulted in a new phrase on Wall Street: “the Bernanke put.”
It basically meant that, if the stock market starts to fall, Bernanke would intervene. I was working on Wall Street at the time, and the “Bernanke put” was a common topic of conversation. And stocks did as the Fed wished.
The “Bernanke Put” Helped Drive Stocks Higher
And now, history is repeating itself—pros are talking more and more about the “Bessent put.” As one lobbyist quoted by the FT put it: “When it counts, he’s a fighter in our corner. It’s almost like this ‘Bessent put’—he knows not to go too far where the markets would be disrupted.”
But this time, the “Bessent put” trade is just getting started.
It’s been less than a year since Bessent was confirmed, so it’s still early. But stocks have returned 15% since he was confirmed, even including the tariff selloff. That also means every selloff in the short term is a buying opportunity—at least while the “Bessent put” is around.
This 8.5% Dividend Is a Smart Play on the “Bessent Put”—and It’s Cheap Now
We don’t have to wait for that next selloff, either, because it’s possible to buy many stock-focused CEFs trading at unusual discounts right now, despite the market’s march higher, like the 8.5%-yielding Liberty All-Star Growth Fund (ASG).
ASG is a holding in my CEF Insider service. It’s a nice pickup now because it holds stocks of companies of all sizes: small-, mid- and large-cap names all feature here. Microsoft (MSFT), Alphabet (GOOGL) and the other top tech names are all main holdings, as well as others, like property manager FirstService (FSV), Ollie’s Bargain Outlet Holdings (OLLI) and DNA-testing firm Natera (NTRA).
ASG not only has a strong long-term track record (it’s up 195% in the last decade, including dividends) but has both increased regular payouts and paid out some huge special dividends, too.
ASG’s Growing Regular—and Special—Dividends
Sure, that dividend does float a bit, but that’s because it’s tied to the fund’s underlying performance. That’s actually a good setup as it gives management latitude to reinvest its profits without worrying about being tied to a fixed payout.
That, in turn, drives further upside for us.
Moreover, as I write this, ASG trades at a 9.3% discount to NAV, which is much more generous than its five-year average of 2%. That puts additional upside on the table as that discount returns to normal. And having a “friend” in Bessent doesn’t hurt, either!
4 More Funds to Play the “Bessent Put” (and Grab Big Dividends While You Do)
The “Bessent put” is key here, because it helps put a floor under high-yielding CEFs like ASG while we collect our dividends in peace.
And ASG is just the start, because I have 4 more funds that will enjoy the Treasury Secretary’s “blessing” while handing us high yields, too. Plus, these 4 high yielders (average yield: 9.5%) are cheap now, giving us even more downside protection (and gain potential!).
I’ve got full details on these 4 bargain-priced 9.5% payers—plus a free Special Report revealing their names and tickers—waiting for you right here. Grab them now and you’ll collect your first dividend payout in a few short weeks.