If there’s one thing that I’ve learned from my research on financial markets, it’s that you always have to expect the unexpected. Nothing is linear, everything works in cycles and what monetary policy makers say is usually wrong.
Last week when the FED raised interest rates, Janet Yellen said: “We’re in a synchronized expansion. This is the first time in many years we’ve seen this.”
That might be true, but the fact is that every economy today is a global economy and the global economy isn’t synchronized. At some point, it will crack somewhere as it always does. The important thing for us is to be prepared for something like that and to see how to best position our portfolios for the consequences that a financial shock might create. More →