April 22, 2022 | Ryan Ermey, CNBC Grow
Robert S. Bacarella recently talked to CNBC Grow’s Ryan Ermey about the markers of a recession and how individuals can potentially hedge huge losses if the market goes south. The article, titled “‘Don’t panic’ about recession predictions, says market strategist: Here’s how to recession-proof your finances,” looks into recent forecasts that the economy will soon enter a recession and shares advice from financial professionals on what regular folks can do to prepare.
Most Americans are worried—a CNBC poll showed 81% believe a recession is coming in late 2022. However, Mr. Bacarella noted that many of the tell-tale signs of a recession aren’t taking place.
“Usually, when you think of recessions, four things happen. Normally you have a high unemployment rate, wages that are declining, lowering housing prices, and declines in the stock market. We’re not really there at this point.”
Despite this, it’s never a bad time for individuals to defend themselves against economic downturn. Mr. Bacarella points to portfolio diversification as a way to avoid panicking when the market slides.
“The best way to defend yourself is to switch to a diversified portfolio. The whole market may be down 8% in a day, but an individual stock you own could be cut in half. Diversification gives you a cushion during a downdraft.”