flix on Nostr: The great thing about scenario analysis is that you can refine and improve as new ...
The great thing about scenario analysis is that you can refine and improve as new data comes in.
China's retaliatory tariff means that we can now reduce to marginal the idea of a fast deal. We are definitely in the RETALIATION quadrant.
A recession is now very probable in Europe and possible in the US. A ~30% drop in stocks is very probable. That would mean 4000-4300 level in the SPY.
The worst scenarios are still unlikely, but their probability is not insignificant and therefore you should have a strategy ready.
Gold proved a good hedge in 2008 (scenario 5) and 1929 (scenario 6). Bitcoin should be in every portfolio as it's the perfect counter to trade wars (as the Ukraine-Russia war has shown- both sides have used it to bypass sanctions - in the case of Russia - and frozen banks - in the case of Ukraine).
Nevertheless I still think that the most likely scenarios are 3 and 4. In both cases the losses from tariffs should be discounted within months and the markets could recover by year end, especially if central banks help out with lower rates and stimulus.
China's retaliatory tariff means that we can now reduce to marginal the idea of a fast deal. We are definitely in the RETALIATION quadrant.
A recession is now very probable in Europe and possible in the US. A ~30% drop in stocks is very probable. That would mean 4000-4300 level in the SPY.
The worst scenarios are still unlikely, but their probability is not insignificant and therefore you should have a strategy ready.
Gold proved a good hedge in 2008 (scenario 5) and 1929 (scenario 6). Bitcoin should be in every portfolio as it's the perfect counter to trade wars (as the Ukraine-Russia war has shown- both sides have used it to bypass sanctions - in the case of Russia - and frozen banks - in the case of Ukraine).
Nevertheless I still think that the most likely scenarios are 3 and 4. In both cases the losses from tariffs should be discounted within months and the markets could recover by year end, especially if central banks help out with lower rates and stimulus.