Threat of Global Recession increasing

Germany’s economy is on the verge of a recession  and already has negative interest rates

US economy continues to weaken especially in the capital goods / industrial sector

US year over year corporate profit growth slowing to 1-2%.

Global business confidence continues to erode from trade wars, Brexit fears, inverted yield curve, negative rates in Germany and Japan

Recommendation

A cautious investment stance is critical in this environment. Maintain high cash levels, reduce equity exposure and tilt equity exposure to more defensive groups like utilities, consumer staples, telcos and Reits.

 

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