Recession

Introduction The specter of a looming recession in the United States has been haunting economic discussions for more than a year. While the recession has not yet materialized, it’s essential to acknowledge the historical lag between Federal Reserve interest rate hikes and their impact on the economy. This lag often spans 12 to 18 months, which is why the signs of a mild recession may be on the horizon. In this article, we will examine various economic indicators that can shed light on the possibility of a recession and provide…

Introduction: In the world of finance and economics, it’s crucial to keep a close eye on various indicators that can provide insights into the health of an economy. Lately, several red flags have been raised, suggesting that we may be heading towards a recession. One of the most significant signals comes from the bond market, often considered the “smart money” in the financial world. Recession Probabilities: The yield curve, specifically the 10-year minus 3-month treasury yield spread, has recently inverted to levels not seen in over four decades. This inversion…

In an economic climate where inflation has cooled significantly and the Federal Reserve seems to be on a path to further increase interest rates, concerns about a recession become valid. While we can’t predict the future, preparing for the worst while hoping for the best is a sound strategy. During tough economic times, your financial plan’s resilience can be tested in ways you may have not imagined. Emotions can become heightened and influence financial decisions. But don’t worry! If you’re looking to prepare for a recession, there are 6 smart…

Amid recent recession talks, the haunting memory of the 2008-2009 Great Recession reemerges in the public consciousness. This era was marked by the loss of over 8 million jobs and a gut-wrenching 50% plunge in the S&P 500®. However, Fidelity’s Asset Allocation Research Team (AART) suggests a comforting outlook, projecting that the potential upcoming recession is likely to be relatively short-lived and milder in contrast. The reasons behind this optimism center on the four crucial sectors of the economy—banks, labor, housing, and household and corporate finance—all of which are in…

Recessions are times when economic activity contracts, corporate profits decline, unemployment rises, and credit for businesses and consumers becomes scarce. During the 11 recessions the US has endured since 1950, stocks have historically fallen an average 15% a year. This history may suggest that selling stocks before a recession arrives and buying them after it departs would be a smart strategy. But savvy investors know that it is extremely difficult to do this successfully and often a recipe for locking in losses instead. Rather, the approach of a recession is…

Introduction Economic recessions are inevitable and can have a significant impact on investors’ portfolios. However, it’s possible to prepare for and hedge against recession risks. This article will explore various strategies to protect your investments during a downturn and potentially even profit from it. 9 Strategies to Hedge Against US Recession Risk Diversification: One of the most effective ways to hedge against recession risk is to diversify your investment portfolio. This means investing in a variety of asset classes, including stocks, bonds, real estate, and commodities. A well-diversified portfolio can…

It seems that the Federal Reserve is in an unusual position: while raising interest rates to slow stronger-than-expected inflation, it is now experiencing financial instability concerns. As a result of the collapse of Silicon Valley Bank (SIVB) and the Federal Reserve’s intervention to support bank liquidity, yields sank dramatically across the board. Nevertheless, numerous factors suggest that the Federal Reserve may maintain elevated interest rates for an extended period, as persistent inflation and recent employment data indicate the need for further tightening measures. We maintain our stance that the Fed…

The financial world has been abuzz with talk about the record-breaking inversion of the interest rate curve. The interest rate curve, a graphical representation of interest rates for bonds of different maturities, has traditionally been seen as a reliable indicator of an impending recession. However, the question on everyone’s mind is whether the current inversion will accurately predict a recession this time. An inverted interest rate curve occurs when long-term interest rates are lower than short-term rates. This is a departure from the typical scenario where long-term rates are higher…

Looking Ahead: Strategies To Invest During A Recession In 2023 As we look ahead to the next recession in 2023, it is important to be aware of the strategies that can help investors make the most of the situation. In this article, we discuss these strategies and how they can be used to create a profitable portfolio during a recession. We also explore how technology such as AI-based platforms can help investors make better decisions and gain an edge over other investors. Introduction: The Coming Economic Recession in 2023 As…

Recessions, also known as economic downturns, are a natural part of the business cycle. They are defined as a period of negative economic growth, typically measured by a decline in gross domestic product (GDP) for at least two consecutive quarters. Recessions can have a significant impact on individuals, businesses, and the economy as a whole. In this article, we will discuss how recessions are defined, analyze past economic downturns in the United States, and explore strategies for navigating a recession. The United States has experienced several recessions throughout its history,…