Several weeks ago, all you could find on the noise making financial news networks and the various talking heads was that a recession is on the way. That pitch has gone by the wayside and equity markets are making all-time highs. Recessions generally occur when there is a widespread drop in spending. A loose definition is when you have several months of negative growth in the US Gross Domestic Production of the US economy.
The article attached indicates that the initial signal given has been reversed but it may not matter that a recession is on the way. My comment on that is a recession is always on the way. However, predicting the start is another matter. The equity markets are setting all-time highs, the unemployment rate is still very low and the consumer, (70% of the American economy is consumer driven) is still spending.
So, we stay the course, investing in large companies paying a good and rising dividend with stock buyback programs and solid management. Add to that, the options overlay that can potentially generate +/- 7% extra cash flow and we will continue to enjoy what historically has been market returns that consistently outperform inflation by a wide margin. Please remember investing in equities has risk and past performance is no guarantee of future returns.
Also, I’ve attached my second podcast about the process I practice and what to expect going forward. Hope you enjoy and would like any feedback on what you might like to hear or get information on. All the podcasts are posted on our web page, www.theliberatedinvestor.com.
Should you have any questions or wish to talk, please call our office or email me at the email shown below. In the meantime, I hope you have a great week!
PS: Always remember, investing in equity markets has risk and past performance is no guarantee of future results.