Keep cash and be ready for market crash

I believe the Fed Reserve will keep raising Fed funds rate to about 6.5% before they stop raising it further. However, the recession may come before the rate hits 6.5%.  They have basically no choice as they know that the Fed funds rate has to be higher than inflation rate in order to ensure that the inflation is fully under control. Whatever the Fed reacted so far was not to frighten off the market players so much so that market will not crash prematurely.  

The conflicts between China and the US will get more intense. China perceives that the US often fails to follow through on its commitments. For example, the US may make promises on trade agreements but then enact policies that undermine those agreements. Despite this, China should continue to prioritize openness and convenience for foreign investors and trade partners, as well as maintaining order and market stability.

China's investments in technology and skills, supported by government initiatives, are likely to result in cheaper products and increased trade. Also, China's large market is likely to be attractive to foreign investors. However, it's important to recognize that there may be concerns around intellectual property protection and regulatory challenges.

In contrast, US government policies that create conflict in business trading with China could have negative consequences for US businesses, including a potential decrease in production volume and an increase in production costs, which could only aggravate inflationary pressure.

From history, it is about time for the inverted yield curve to make the US economy go into recession between the period from June to September 2023. 

The simple and logical thing we can do now is to keep cash and get ready for the market crash.

Prescientsuper
http://superphang.blogspot.sg