The world will be a radically different place in the next 5 years. Mark Twain did say that ‘history doesn’t repeat itself, but it often rhymes’. Events like major wars where the world where most of the countries are involved happens approximately every 100 years. Where the superpower of that time is tested. The wealth gaps of today does reflect a lot of the same thing that the world experiences almost a century ago.
When it comes to the financial health of the countries, debt levels of today are unprecedented and can destroy the economy of the country. Even the populist beliefs between the leftists and rightists have become completely opposite. The world order of today has been changing. We are experiencing things that one would have not experienced during his lifetime.
How do you invest in such situations ? If your doing a monthly contribution towards your investment, it shouldn’t be much of a difference to your portfolio as you will be investing in bad times as well. But if your trading in stocks or have a lumpsum to invest then now would be a time to hold your horses. Keeping it in cash or short term debt can be an attractive proposition. The valuation of today has limited upside and more chances of it going down south. Now holding on to cash or short term debt can be an advantage when markets start correcting.
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