What to do in times like these? Part two:
If we don't see a recession across most of the developed world later this year, I would be extremely surprised. So, what can investors do about it?
Setting aside the recent inversion in the yield curve, where the yield on short-term 2-year US Treasury bonds rose above the yield on long-term 10-year bonds, traditionally considered a sure sign of imminent recession, there is common sense. How can there not be a recession? Costs are rising must faster than wages. Interest rates are rising. Costs will continue to rise later this year as grain shortages begin to be felt. History also shows that significant spikes in the oil price invariably precede recession. What should investors do in a recession? The age-old advice to investors worried about inflation is to either…