Fixed rate debt, locking in low rates in undervalued assets prior to rate hikes, before the Fed pivots and starts hyperinflation so you own a house (while everyone else is sidelined in hyperinflated cash/high interest debt)<p>During a downturn with rate hikes, a possible sovereign debt crisis and commodities/inflation possibly moving higher, look at high yield treasury bonds<p>max out series i bonds
- $10k per person or company
- 9.62% yield atm
- state tax exempt<p>if you have a lot of extra cash and no debt or low interest fixed rate debt, then park it in a no penalty CD, savebetter is paying 3% CD atm, no penalty, withrdaw anytime
then park the rest in 2-2.5% savings accounts atm
Investments have less to do - at this time - with a recession or a looming recession so much as the impact of federal monetary policy.<p>"Don't Fight The Fed"<p>If the fed is trying to actively cool down the economy by raising the interbank lending rate, this increases the price of capital for all companies. This also incentivizes people to not invest in companies - if they can get a "Risk Free" return from treasury bills of 4.5% today why would they invest with a 100% risk asset.<p>So no, forget 'recession' instead change your question to 'whats the best investing strategy to have during a period of monetary tightening' - and that is, in general, to not be investing until you think the period is over. Good luck with that one.
I am not a financial advisor. Nor am I your financial advisor. Below are my opinions.<p>It depends. Countercyclical assets are a common strategy. Sometimes called "guns and butter." Utilities, some bonds, bulk food production, etc.
There is no widespread right answer to this.<p>The best strategy to invest (with the goal to make money) at any period in economic cycles is have more accurate information than other people.<p>If you are worried about economic outlook, instead of investing money into financial instruments, invest time and some money into increasing your own personal value by learning new skills.
starting a business (that produces things people need rather than want)<p>as far as investments like stocks or bonds... i am largely sitting in cash since the invasion of ukraine. when things get bad enough (and the fed pivots) then i will buy stocks.<p>or you could just DCA if predicting macro trends isn't a fun filled activity for you (it is a hobby of mine).
Watch some Charlie Monger videos. For the people I see talk he and Ray Dalio do some of the best investment talks I feel.<p>One here from Monger, dont sweat the link bait headline: <a href="https://www.youtube.com/watch?v=v5UCmsXpngA" rel="nofollow">https://www.youtube.com/watch?v=v5UCmsXpngA</a>
I think it's <i>very important</i> to understand the root causes of the changes in the economy, and have a good model to use in predicting the future and planning your course of action.<p>There are a number of factors in play currently that go beyond the normal boom/bust business cycle.
Inflation is high. Your money is worth substantially less every month in this economy. I personally had a fair amount of cash lying around, so I am doing as many major home improvements as possible.
If you are sure about the recession and expect the stock market to crash, you could short it.<p>Short it directly, or buy a short ETF, or buy put options