
A Recession Indicator
At the beginning of the pandemic, our portfolio models were more conservatively positioned than they typically would be. I do not have a crystal ball and could not have predicted a global pandemic, but the bond yield curve inverted on August 26, 2019, signaling an increased risk of recession in the coming year. In response to the weakening economic conditions, I reduced portfolio risk and wrote several client emails outlining the concerns and the steps I was taking. Already being on Recession Watch, I probably reacted more quickly to the new health risk than I would have during other periods of the economic cycle.