Chart of the Day: How To Avoid Recession

JC Parets
June 4, 2022

A lot of the worst investors I know and people who I regularly like to bet against are preparing for a recession.

Are you?

I've always been in the camp that recessions are the economic implications of changes in asset prices.

And that's because, well, it's just fact. Price leads. The "economy" follows....

So for me, I'd rather just focus on price then. Why would I waste time on the lagging data when we can spend our time on the forward looking data?

And so here we are.

What's it going to take for stock prices (outside of energy) to stop falling?

I think it's more of what we've seen over the past few weeks: A weaker Dollar.

Commercial Hedgers are still very aggressively short the US Dollar.

If they're right, stock prices are likely going to rip higher.

And that's the bet we're making.

So maybe you're one of these "corporate execs" preparing for a recession, or perhaps one of these gloom & doomers hoping for a stock market crash, or maybe just an investor who got smoked with too much growth exposure and now you want everyone else to suffer too!

If you fit any of these profiles, I think you need to see a historic breakout in the US Dollar for you to get what you want.

And maybe it does happen, and stocks collapse, and we enter into a recession.

Maybe...

But what if it doesn't.

What if the Dollar rolls over here like it did on the prior 2 occasions?

What then?

In this video, we try to answer this question as best we can and outline the best opportunities. ASC Premium Members can watch this week's live strategy session here and download the slides.

If you don't have access, ping Peter and tell him JC said to hook you up.

Give it a watch and then let me know what you think!

- JC

 

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