A recent NPR story warns that signs are pointing to a coming U.S. recession, “according to an economic indicator that has preceded every recession over the past five decades.”
What is known as the “yield curve inversion” has been flattening out and sloping down for over a year, but as of June 30, 2019, the yield curve was inverted for an entire quarter.
Over the last seven recessions in U.S. history, this phenomenon has been “a clear signal that the economy is heading for a recession in the next nine to 18 months, according to Campbell Harvey, a Duke University finance professor.”
The yield curve inversion refers to when long-term interest rates are paying out less than short-term rates.
In the NPR story, Harvey was quoted as saying, “From the 1960s, this indicator has been reliable in terms of foretelling a recession, and also importantly, it has not given any false signals yet.”
Image Source: www.npr.org
So, if a recession is on its way, are you prepared?
Is your retirement account recession-proof?
You might want to start looking at assets that can help protect your money when the market starts to turn.
This is one of the features of what we call The Ultimate Asset, which you can use to both protect AND grow your assets.
The Ultimate Asset is one that:
- Is liquid, so you can access it whenever you need the money (even if you decide to retire before you’re 59 ½)
- Has very little risk, so you don’t have to worry about losing money during a recession
- Doesn’t have any (or at least very little) expenses
- Beats the market in returns (with no risk of loss)
- And is more tax-efficient than any other
If you’d like to learn more about The Ultimate Asset, we have a free educational video you can watch right now by clicking here: https://acf.aspencreekfinancial.com/ultimate-asset/.
The Ultimate Asset could be the thing that ensures you can retire when you want to, despite the predicted upcoming recession.
Understanding this recession indicator can help you manage your risk and make sure that your money is in the right place.
Harvey says, “I look at it more in terms of risk management. This is an important piece of information. It helps people plan. It enhances the possibility that we have a soft landing, not a hard landing, like a global financial crisis.”