At the start of 2022, Bonds were in a bloodbath, stocks seemingly are starting a correction and expected rising interest rates may blow the real estate bubble. We are currently living in the everything bubble where almost all asset classes from commodities to real estate to stocks and bonds are in some form of bubble.
This begs a question, which bubble will burst first? It’s a bit of a trick question because the bubble no one is paying attention to is the boomer retirement bubble and that will have dire consequences for the labor market and all asset classes.
We expect boomers to continue to retire in larger and larger numbers and we expect more jobs to go unfilled. Eventually some businesses will close and we expect small businesses to take the biggest hit in labor shortages until there is a new equilibrium.
We continue to build a portfolio of stocks that we think will do well in a higher interest rate environment but ultimately are moving toward top heavy dividend paying stocks.
The next 90 days will be critically important to pay attention to economic data, central bank policies and other government activities as will impact all markets.
Stay tuned and stay solvent…