Economic dating committee
We acknowledge there are also other risks facing the economy and the markets (link), including, global growth deceleration, the inverted yield curve, Brexit, and the potential for new tariffs on other countries.Our role at Winthrop Wealth Management is to help our clients identify, manage, and navigate risk by providing a comprehensive financial plan combined with a structured, consistent, and repeatable investment process.We implement a proactive approach to both comprehensive financial planning and investment management.Financial planning drives the investment strategy and provides a roadmap to each client’s unique goals and objectives.
While reaching the longest expansion in United States history is a nice milestone, we will point out that the overall growth rate has been sluggish.The chart below illustrates the shallow recovery since the Financial Crisis: Given that the current economic expansion is now the longest in history, does this mean that the United States is overdue for a recession? Historically economic booms were followed by busts.An over-simplified business cycle typically followed a similar pattern: the economy expands rapidly – unemployment falls – inflation overheats – financial bubbles forms – the Fed responds by raising interest rates – credit tightens – good borrowers struggle to find loans – the economy stumbles – a recession occurs – the economy bottoms – repeat.On August 1st, President Trump threatened to place 10% tariffs on the remaining 0 billion worth of Chinese goods beginning on September 1st.As of now, the US has implemented 25% tariffs on 0B worth of Chinese goods and China has placed 5-25% tariffs on 0B worth of US goods.
The current environment is characterized by slow growth and the Fed just cut interest rates to fight low inflation and global uncertainty.