Author Topic: 2023 Recession  (Read 663 times)

littleman

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2023 Recession
« on: November 09, 2022, 03:33:56 AM »
It is practically a forgone conclusion.  There are a lot of companies leaning out. The FED is willing to push the economy down to stave off inflation.  What are your strategies to mitigate the pain?

Brad

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Re: 2023 Recession
« Reply #1 on: November 09, 2022, 04:13:38 PM »
Frankly, it's probably already too late for us little people to do much other than batten down our spending and conserve.

Personally, I won't be investing in any cryptocurrencies. 

If I put any more money in the stock market I'd put it in mutual funds that invest in non-Chinese (prefer USCan/UK/EU) companies that make stuff related to clean renewable energy: (wind, solar, etc.) and let it ride.

ergophobe

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Re: 2023 Recession
« Reply #2 on: November 10, 2022, 01:46:55 AM »
I know this is singularly unhelpful, but my strategy is pretty much always the same: keep my cash emergency fund topped up and be prepared to spend it if need be.

I have not been doing much (any?) belt tightening, but more trying to identify things I can reduce. Frankly, though, the big costs are insurance - homeowners and medical - and I don't have any way to bring those down.

If you're looking for a secure investment with a decent guaranteed return, I Bonds are currently at 6.89%, which isn't bad for a cash investment.

rcjordan

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Re: 2023 Recession
« Reply #3 on: November 10, 2022, 02:16:06 PM »
>I Bonds

Yeah, but they're short term, right?  2-year Treasuries were recently around 6%, IIRC.

I'm planning to check rates on jumbo CDs.

Since I'm retired, my income plans are largely locked in. 

>I have not been doing much (any?) belt tightening, but more trying to identify things I can reduce. Frankly, though, the big costs are insurance - homeowners and medical - and I don't have any way to bring those down.

Same. And travel & entertainment expenses have already been reduced.

ergophobe

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Re: 2023 Recession
« Reply #4 on: November 10, 2022, 04:32:24 PM »
>>short term, right

30 years, but redeemable after 5, earlier with penalty: "Redeemable after 12 months with three months interest penalty. No penalty after 5 years."

This is different from TIPS, which many people say are much better. TIPS have longer maturity, but they are tradeable, so you can sell. But I know nothing about bonds, so when people start talking about stuff like that, my head explodes and I go into inaction. Thus, I am not looking at TIPS
https://www.treasurydirect.gov/research-center/history-of-savings-bond/comparing-tips-to-i/

ergophobe

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Re: 2023 Recession
« Reply #5 on: November 10, 2022, 04:39:59 PM »
CDs - Ally is at 4% for 18 months. 4.1% for 5 years.

If you think inflation is going to moderate, the 5-year CD is looking pretty good compared to short-term or even compared to I Bonds, which are indexed to inflation, so if inflation comes down, so does that 7% return.

Long term CDs are a bet that inflation will come down

I Bonds are a bet that inflation will rise or only slightly moderate

rcjordan

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Re: 2023 Recession
« Reply #6 on: November 10, 2022, 05:47:29 PM »
I'm with a *very* conservative regional bank.  They were asked to buy up failed bank chains during the last banking crash.  My cash position exceeds FDIC insurance by quite a bit.  I'd like to lock in a couple of 4%+ mega-CDs with them for a few years to help offset some of the inflation.

ergophobe

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Re: 2023 Recession
« Reply #7 on: November 15, 2022, 07:23:52 PM »
LM - I suspect you will find this obvious, butů

https://www.schwab.com/learn/story/5-tips-weathering-recession

littleman

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Re: 2023 Recession
« Reply #8 on: November 15, 2022, 08:48:00 PM »
Always good to read this stuff, thanks.