There comes a time in every cycle for investors to start considering where the best odds of having a green year are, and it is all rooted in the way that the broader United States economy is headed next. Today, everyone might think that the cycle is still running hot as it has since the COVID-19 pandemic, when the system was flooded with low interest rates and newly printed money that needed to make its way through businesses and consumers alike.
With this in mind, today’s cycle looks a lot different; with bond yields on the rise and higher interest rates, the Federal Reserve (the Fed) is going to restart the cycle into the early stages of spending and restocking now that prices and inflation have come slightly off in this normal phase of the cycle. Understanding that declining inflation will make it easier for businesses to get inventory on hand when interest rates eventually come down is the foundation for this new cycle.
