Are you worried that we might be looking at a recession in 2023? If the answer is yes, you are in good company. The Federal Reserve Bank of St. Louis warned at the close of the year that 27 states already show signs of slowing growth in this article. Most economists at trading firms and investment firms surveyed by The Wall Street Journal expect a recession to begin in 2023 or 2024.
Until inflation is conquered, the Fed will likely continue raising interest rates, which carries the risk of triggering an economic downturn.
On the other hand, the consensus forecast is only sometimes correct. Remember, the consensus also thought inflation would be transitory as the economy emerged from the pandemic lockdowns. Uncertainty is inherent in economic forecasting.
In his Intelligent Investor column in The Wall Street Journal, Jason Zweig observes that 2022 was one of the worst years in history for a 60/40 mix of stocks and bonds. This was because both stocks and bonds were down for the year. Looking at the history of the financial markets, such a poor performance is unlikely to repeat in 2023. Mr. Zweig suggests that “early retirees and younger investors should regard the recent calamity as an opportunity.”
If you would like a professional review of your portfolio, please do not hesitate to contact us. At Legacy, we build customized portfolios to meet your objectives through a disciplined, consistent approach that emphasizes extensive market research, security selection, and strategic asset allocation. Our investment management services will give you confidence in growing your assets.
If you are a Legacy client and have questions, please do not hesitate to contact your Legacy advisor. If you are not a Legacy client and are interested in learning more about our approach to personalized wealth management, please contact us at 920.967.5020 or firstname.lastname@example.org.
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