Wossamata U and the Coming Recession

In an old Rocky and Bullwinkle episode, Bullwinkle is recruited to play for Wossamata U.* The school is going downhill so, on the advice of coach “Rocky Kanute,” the board decides to “fire a few English teachers” and “get the best football team money can buy.” The show progresses into an eventual clash with Boris Badanov and Natasha Nogoodnik, which just shows how little has changed in over 50 years.

We now find ourselves in conflict with the Russians and the Chinese, people are worried about the US keeping it’s “global reserve currency,” and what seems to be an entrenched inflation situation whereby today’s (April 12th) report^ of 5.0% looks good only in relation to the previous 12 months of readings. On top of this, the recent data^* including the ISM report, the yield curve, falling house prices, and reduced credit from banks are all recessionary indicators. In other words, shades of 1973 all over again. Historical data shows that 2/3rds of the stock market’s drawdowns have occurred during, not before, the recession, and 8 of the last 10 recessions saw drawdowns of 20% and more*^. So, what to do?

Maybe it’s time to look at some old ideas. Perhaps 5+% on fixed accounts and stock market linked strategies protecting as much as 20% to the downside^^ would put some calm into your investing world? Or maybe accounts that have no risk to the downside and are linked to returns in the major indexes? To learn more, please visit our website and/or call for a 15 minute discussion.

*https://www.youtube.com/watch?v=Dr-4B6RbG08

^https://global-premium.econoday.com/byshoweventfull.aspx?fid=559228&cust=global-premium&year=2023&lid=0&prev=/byweek.asp#top

^*https://www.zerohedge.com/markets/hartnetts-dirty-dozen-doom-12-charts-coming-recession

*^Source: B of A Global Research

^^Buffered accounts may provide up to 20% protection from index declines while also allowing for 100% participation in the index chosen. Please refer to a product prospectus for specific information on costs, crediting methods and buffer protections.

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