The path of our economic evolution is not preordained and designing portfolios for any number of inherently unknowable outcomes requires a flexible process.
The path of our economic evolution is not preordained and is difficult to predict with much precision.Strong balance sheets with limited debt, lots of cash, low dependence on the capital markets, good cash flow and the ability to operate and earn, are the core of my pandemic portfolio.
He argued that cash and bonds are unattractive asset classes in today's environment. He says that in response to Covid-19, the Federal Reserve and federal government have so dramatically suppressed interest rates and ballooned the money supply that inflation will soon return with a vengeance. When that happens, he says, investors will be better off owning growth stocks, for instance, that can at least somewhat protect against the expected surge in inflation.
Now, you may have also heard other professional money managers talk about the risk of a deflationary spiral. They may have said that notwithstanding the massive job losses and business shutdowns, Covid-19 is likely to have a far bigger impact on aggregate demand than aggregate supply. In other words, the economy will be running at significant excess capacity . And as we all know from Econ 101, if demand falls faster than supply then prices will not rise, as Mr.
Strong balance sheets with limited debt, lots of cash, low dependence on the capital markets, good cash flow and the ability to operate and earn are the core of my pandemic portfolio.
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