Vanguard sees a recession in 2023 — and one 'silver lining' for investors

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Vanguard sees a recession in 2023. But there is a 'silver lining' for investors.

The last 12 months was a year of fast-rising inflation, fast-rising interest rates and fast-rising questions about a future recession.

On Tuesday, inflation data for November showed prices are continuing to cool. From October to November, the cost of living nudged up 0.1%, lower than the 0.3% forecast, the Consumer Price Index showed. Year over year, the inflation rate receded to 7.1% from 7.7% in October, according to the CPI data.

That echoes the view from Treasury Secretary Janet Yellen, who said Sunday there will be “much lower inflation,” absent any unanticipated shocks to the economy. In Vanguard’s view, it’s not so bad. “Households, businesses, and financial institutions are in a much better position to handle the eventual downturn, such that drawing parallels with the 1970s, 1980s, 2008, or 2020 seems misplaced,” the authors wrote.

Spotting the opportunities When interest rates go up, bond prices go down. So it’s been difficult for bonds with lower returns and “near-term pain” for investors this year, the Vanguard outlook said.

 

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Been saying.. this is not 2006 again.

Sweet. Moved to market. Good luck, bulls.

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