My sense is that the Fed is doing it’s core job to try and tame inflation. In my opinion this should be applauded, but of course risks abound. The Pandemic unwinding was one thing, but now Russia over played their hand and the Western world is galvanized. This is exactly the shifting world order stuff that Ray Dalio has been talking about. Will raising rates and other macro challenges trigger a recession? Perhaps, but not time to panic, time to be prepared now.
Now that inflation is running so hot, the recession word is being used more often. We all know about our economic dependence on oil. I am still staying put with long term investments in quality names such as the Fed Ex or JNJ’s of the world. Perhaps the current market turbulence has hit a bottom? The only thing we really know is that through all of history the market experiences turbulence and overall goes up. Indexes can be handy because they are “self cleaning’, knocking out the losing companies over time and building on the strong ones.
WHAT I AM DOING?
The short answer is nothing drastic. I am sticking with a sound strategy of bucket investing. I will keep some cash for strategic plays in commodities, energy, etc. But by and large I am sticking to diversified funds and ETF’s, dividend aristocrats with fortress like balance sheets, etc. I am also making some shifts into more Cybersecurity stocks/etf’s and other themes that I believe will carry on for the next 20 years.
I have been disappointed by the performance of Bitcoin, although I still hold. In my mind it was made for moments like this. Bad global actors, asset freezes and inflation. But it seems sleepy.
We will always be in a never ending cycle of human news events, unless one lives in Russia and hears one dictator’s view of the world 24/7 into mass brainwashing. There will continue to be geopolitical challenges. Always have been. I am just a buy the dip / dollar cost average guy at heart. Keep building those passive income machines and own quality assets.
Yes, folks are concerned with a recession, and it may very well happen. If I am a long term investor I have lived and invested through several recessions. In fact, there was one in recent memory that was close to a Great Depression. But after the dust settled, folks kept on living and assets overall rose again.
I am staying the course on many fronts and simply continuing to buy quality assets within a diversified portfolio. In addition, now may be a good time to finally pull the trigger on that electric vehicle with solar panels.