Red Light: Consider moving to cash and lower risk assets, preserve value.
Yellow Light: Consider balancing lower risk and moderate risk assets, avoid higher risk assets, seek moderate return.
Green Light: Consider increasing higher risk assets, seek higher return.
Current Investment Headwinds:
- Pandemic is persistent, with continuing economic impact
- Federal Reserve embarks on rate tightning cycle and unwinding of quantitative easing
- Slow economic growth in Europe, Japan, and China
- Revaluation of individual Bonds
Current Investment Tailwinds
- U.S. corporate earnings – upward trend continues
- Rebound in the labor markets, low unemployment rate
- New disruptive technologies may increase productivity and lower cost of doing business
- Supply chain repair – slow but steady
- U.S. consumer is healthy, but inflation is taking a toll
- Congress appears to have no appetite to raise taxes or to significantly expand domestic spending