December  2020 Economic Outlook

After the burst of the technology driven stock market of 1997-1999, Warren Buffett said it best in 2000, Nothing sedates rationality like doses of effortless money.

 The Nasdaq enjoyed a terrific run in the last half of the 90’s only to drop about 80% in the early 2000s.  Further, it has taken Nasdaq 15 years to recover from the first big tech-crash, according to the guardian.com, April 23, 2015.

 December 2020, Harry Dent, Founder & President, Dent Research put it this way. This bubble has outlasted all others in stocks for going on 9 years by the most conservative measure since the first-correction in late 2011.  All such bubbles in history crash badly-with NO exceptions!  And this one is the greatest by far.  It’s the most global and spans all of the financial asset sectors: stocks, real estate, bonds, gold, and a new one, cryptocurrencies.

This isn’t my first time to the rodeo.  Thanks to 1987, 2000-02. 2000-09, 4^th quarter 2018, and 1^st quarter 2020, we have a one-two punch for investors who might like to limit their losses.  Now may be the best of times to add new diversification legs to your life savings as you employ active management strategies that can move out of risk assets into money markets or cash in a bad year and back into risk assets after the smoke has cleared in a good year. Be not surprised if today’s highest flying becomes tomorrow’s hardest falling.  Discover before year end how you might win by losing less.

All investments involve the risk of potential investment losses and no strategy can assure a profit. Past performance does not guarantee future results. Diversification seeks to reduce the volatility of a portfolio by investing in a variety of asset classes. Neither asset allocation or active portfolio management guarantee against market loss or greater or more consistent returns.

The Investor’s Advantage Risk-O-Meter reflects the company’s overall opinion on the economy and the stock market.  Leading indicators include the US Economic Outlook, Monetary Policy, Fiscal Policy, Leading Indexes, Global Economic Outlook, Corporate Profit Growth, Inflation, Equity Market Valuation, and Geopolitical Risk.

Do you know how much risk your portfolio and retirement accounts are taking? Understanding the risk of the economy and how it relates to your money is crucial. However, this means nothing if your investments aren’t designed around YOUR risk tolerance and YOUR financial goals. We’ve partnered with the fantastic folks at Riskalyze to offer a free tool that pinpoints your Risk Number so that you may informatively guide your portfolios asset allocation.

The information presented does not involve the rendering of personalized investment, financial, legal or tax advice.  This information is not an offer to buy or sell, or a solicitation.