According to Bloomberg, the very wealthy of society are actively preparing for a large stock market crash or correction in the future, with some saying that it may be as close as a year away from now.
A synchronized global slowdown, with no end in sight, has spooked some of the wealthiest investors around the world, according to a new survey from UBS Wealth Management, seen by Bloomberg. UBS polled wealthy investors, who are preparing for a significant stock market correction by the end of next year.
In the survey of more than 3,400 high net wealth respondents, 25% said they’ve sold risk assets, such as equities, commodities, and high-yield bonds, and have transitioned into cash. The synchronized global slowdown, coupled with a US-China trade war, were some of the greatest concerns of respondents.
“The rapidly changing geopolitical environment is the biggest concern for investors around the world,” said Paula Polito, client strategy officer at UBS GWM, in a statement. “They see global interconnectivity and reverberations of change impacting their portfolios more than traditional business fundamentals, a marked change from the past.”
About 80% of the respondents expect volatility to increase through 2020, and 55% believe a market plunge could occur before Q4 2020.
Worse, 60% of respondents expected to raise cash levels in the coming quarters (i.e., sell stocks).
Most respondents said the added caution is due to a possible blowoff top in global equity markets. About 70% of respondents are optimistic through 2030.
The challenge is that they seem to want to respond” to short-term uncertainty “by really shortening their time horizons and shifting to assets like cash that are safe,” said Michael Crook, a managing director on the investment strategy team. Though with many of these people investing on a time horizon across decades and for future generations, that “seems like a mismatch.”
And while most respondents said they’re preparing for market turbulence in the short term, many should rethink their US outlook for the next decade. Teddy Vallee, CIO of Pervalle Global, shows that the “US is dead money for the next 10 yrs.” (source)
Based on my analyses, a crash is indeed coming, but is less likely to be immediate, with a high chance around 2023, taking into account political and social factors. That said, a major decline is inevitable because it will only be an extension of the crash of 2008, and from which the US economy never recovered and which you can read our full analyses in the Shoebat archives.
However, having said this, one must consider what the future will look like. It certainly will involved higher rates of unemployment, social decline, and societal problems, and it will affect all people. As I have said repeatedly, one NEEDS to find alternative forms of employment in working a second job, or else getting a lot of overtime.
However, how does one go about getting a second job?
This is not something that I have addressed before, but I will briefly mention two options for consideration outside of simply going “door-to-door”.
The first is with Indeed.com. The site has a very large number of jobs and is updated daily, and covers many different job search engines. Because of this quality, one can look for jobs that are in one’s area as well as look for a large number of different jobs. This is
Another interesting venue for jobs that are largely home-based or online is Ratracerebellion.com. These jobs require more “upfront” work because a lot of people apply to them, but the site has many good options that can fit into busy schedules to provide supplemental or possibly a full-time income.
Now nothing mentioned here is to per se mean “go and quit your job”. To the contrary, it is about looking into additional options that a man can use to help himself.
The fact is that things are not going to get better. Rather, it is for people to start taking care of their own needs as much as possible while the means are still available to do them.
The analogy of the ant and the grasshopper fits well here. It is not exactly an economic “summertime” right now, but it is comparatively better than what it could or will be, and as things are still OK, it is for one to work as much as possible to prepare for the inevitable. One cannot stop what is coming, but can be better prepared than if one did nothing.