Complacency Getting Steamrolled By Rising Interest Rates
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It’s a whole new investment landscape out there, and the sooner investors catch on, the better.
But it’s hard to change, especially when the “trend is your friend” play has been in place for 40+ years.
The one that Paul Kiker and I discussed this week is the 40+ year regime of ‘steadily falling interest rates’ in the US.
Everything has changed now. What worked before won’t work as easily or at all. Buying and holding US Treasury paper for one.
Buying real estate as an investment for another. Achieving positive cash flow during a falling interest rate environment is a completely different beast from making gains in a rising interest rate environment.
Thirdly, the buy-every-dip stock crowd has yet to have their complacency shredded, but that’s coming.
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Disclosure: None.