BBRG: How to Invest and Profit in the Next Recession

How to Invest and Profit in the Next Recession
A slump is likely in the next year or so. There are ways to prepare for it.
Bloomberg, June 17, 2019




Today, I want to discuss the next recession.

I do not know when that is coming, only I do know that one will eventually be here. In the post-Great Recession era, which ended in June 2009, the economy has seen gradual improvements but remains below historical recovery levels and has expanded a long time without a contraction. According to Reinhart & Rogoff, this is to be expected.

All of the recession forecasts of the past decade have one thing in common: None took place after a yield curve inversion. What is different today is the current extended yield curve inversion, which I discuss in my column this morning.

For this discussion,I channel Campbell R. Harvey, Professor of Finance at Duke University’s Fuqua School of Business. He is not your run of the mill recessionista running around with his hair on fire; to the contrary, he is a sober, thoughtful researcher. He has previously discussed what he calls the “four warning signs” of a pending recession.

Since we can all agree that another recession is inevitable (eventually), then I am going to go out on a limb and suggest now is the time you should anticipate and make plan for the next one. Hence, today, I make 4 key suggestions as to what you should be doing right now to make sure you get through the next recession relatively unscathed:


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I originally published this at Bloomberg, June 17, 2019. All of my Bloomberg columns can be found here and here



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