With inflation not slowing down – Powell and the Federal Reserve keep talking about hiking interest rates – but we don’t know how high they’ll go.
As a kid, what was one of the best parts about being sick and staying home from school?
Well… besides getting to stay home from school.
For me, it was getting to watch daytime TV that I normally wouldn’t watch if I weren’t sick – which, I’m ashamed to admit, included the soap opera, Days of Our Lives.
However, the highlight wasn’t drama to the Nth degree…
It was the daytime game shows that I loved – but none more than the Price is Right. Bob Barker with his long, skinny microphone – the pretty hostesses – the “Big Wheel” – all of it was awesome!
But my favorite game, besides Plinko, of course – was Cliffhangers…
I don’t know why – but watching that little man go up the mountain while yodeling was just fun to watch. I think it was the anticipation of it all. Would they guess correctly and keep him from moving too much? Or would they screw up HORRIBLY and watch that little yodeler fall off the edge?
As much as I loved this game on the show…
I don’t like it so much in real life – as it seems that’s the exact game we’re playing with the interest rates.
Interest Rate Cliffhanger
Once the minutes of the December Fed meeting were released – it seemed to freak everybody out – as the talk of tapering and hiking interest rates put everybody on edge.
But for good reason…
As it seems that said interest rate hikes could arrive a lot sooner than investors were expecting – and faster too – as Goldman Sachs just predicted that the US will experience at least FOUR rate hikes in 2022.
You heard that correctly: FOUR.
And Goldman Sachs aren’t the only ones predicting four rate hikes – as JP Morgan Chase CEO Jamie Dimon recently revealed his thoughts on interest rate hikes on CNBC – saying, “I’d personally be surprised if it was just four.”
So, if that happens – do you know what is most likely sitting on the horizon?
If you said, “Another bull market?” – I applaud your enthusiasm and optimism – but you’d be wrong.
The “R” word – Recession.
It seems like the last one JUST happened too – and now – we could be facing another one this soon? Come on, Washington – get you s**t together.
That being said, what can we, as investors, do to protect ourselves if we DO enter another recession – and even more – is there anything we can do to come out wealthier on the other side.
The answer to that question is: absolutely.
Three Steps To Survive (And Thrive) In A Recession
There are actually three things that you can do right now that will help you prepare for a coming downturn – and it’s really nothing too drastic…
First, you may want to switch out some high growth stocks for some blue-chipper value stocks.
High growth stocks are great while the economy is booming – however, industries like tech tend to take a hit during downturns – so it may be prudent to start looking for some more value stocks with less growth potential and swap them for those high growth prospects.
The second thing you can do?
Add some bank stocks to your holdings.
The great thing about bank stocks – is that most banks have INCREDIBLE diversification with several streams of revenue – with interest on loans being one of the biggest.
When the rates go up – banks tend to profit the most – so why not jump in on those profits yourself?
And the third thing you can do is add more commodities to your portfolio.
While volatility and inflation are surging – commodities tend to be a safe haven for wealth – which is why many prudent investors prepare for recessions by moving into precious metals…
While gold is GREAT during economic downturns – their not the only answer: lithium, copper, silver are all fine and safe places to put your money generally.
Your money may not grow as fast as it would in a hot biotech opportunity – but it’s safe – and even small growth is still growth.
Of course, there are other options as well…
One way is to set up your portfolio in a way to set you up with stocks that continually pay you money – or you can use the method our friend Ted Bauman uncovered that Forbes says “literally prints money.”
If not, then realize, this probably recession is the hand we’re being dealt – and unfortunately – there’s no mulligan…
We’ll have to play with what we got. And while we can’t stack the deck in our favor – we can bend the odds in our direction a little.
If it works on the Price Is Right…
It’ll work for us!