At the beginning of 2022, our concerns included:
A new Covid variant and supply-chain bottlenecks causing more inflation
Rising interest rates intended to slow demand and lower inflationary pressures
Lower earnings growth in 2023.
Other concerns included China’s Chip & Tech War, the pending invasion of the Ukraine, the systemic effect that a post-Covid oil shock could have on the worlds’ economy, the Fed tapering its purchases of bonds, and its need to sell at least some of those bonds in the open market.
At the beginning of the 2nd Quarter of 2022 our concerns now also include:
Yield curve inversion, and an even more aggressive Fed
An oil-shock/supply chain induced recession in 2023
China’s acquiescence of Russia’s invasion and potential funding of Russia’s war effort
“One inch of NATO territory…” leading to an escalation of the conflict
And the ever-present something we don’t see yet.
We are buying now because:
Peace is on the horizon
Oil is correcting
Supply-constraint induced inflation will abate
NATO has a stronger, more unified purpose with broad-based funding, aka the peace dividend
Stocks that went down by 50% or more are now recovering.
Very careful security selection is required because this is not a “buy the dip” market. Please anticipate significant volatility in the coming weeks and months but don’t let this rare opportunity pass.
Call now for an immediate portfolio analysis and investment proposal.