In the face of pessimism about the possibility of a recession and the Fed’s efforts to curb inflation at any cost, many investors may be worried. An analysis of the historical data from past recessions suggests that waiting for favorable market conditions could leave an investor at a disadvantage, compared to those who remain in, or enter, the market, irrespective of current conditions.
Financial advisors are right to recognize current market conditions as a concern. Investors, often pessimistic when driven by fear, may opt for inaction instead of having a candid discussion about recession, inflation, and Fed policy. A look back at history prepares financial advisors to initiate meaningful conversations with their clients about the opportunities and pitfalls of greater uncertainty.
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