FED, Wisconsin, Minneapolis discussed on The Opening Bell with Steve Grzanich


Recession picking up from some of the work that we do in august september what is this year of this year well what it means is that it triggers that signal that by the way it's coming forward we saw in two thousand and six that was well in advance of actually the markets falling apart so it doesn't mean that the stock market is is going to turn down right away what it does mean as while that indicators is below rain recessionary levels stock market returns from the beginning of that signal to the end of that signal generally are below shortterm interest rates so interest rates are two percent we could see an equity market that's returning something between zero and two percent and that's more there are is that the markets are could struggle starting maybe in the fall and again that may tie into midterm elections as well so there's other things that are going on that may may force that hand and the fed is is been very aggressive in aggressively talking about raising rates so we would expect in september that they'll bush rates again by another twenty five basis points and again flattening at you'll curve even more so we take some cash off the table a little bit you know we've taken a little bit off over the course of the last six months or so we've got a little bit higher cash level a little bit lower equity exposure than we normally would have and a little bit higher bond exposure it we're at the late innings i think of this market expansion that doesn't mean that the stock market can't go up another ten to fifteen percent from here that's very possible but when we looked out over the next three to five maybe seven years it's going to be a very tough tough road to go because we do expect to have a recession somewhere in that x three to five year window which means equity prices could be down anywhere from ten fifteen to twenty percent from the high point to the low point until you'd like to have a little bit of powder dry to take advantage of those lower stock prices so we we've been a little a bit more cautious in in our portfolios starting over the last three three months or so big plans for the weekend it's going to be kind of a quiet week and i've got some travel plans had up to the great northern woods of wisconsin over to minneapolis to visit some family awesome health cofounders have resigned from the company's board.

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