This is the second post in a series where we share the best tools and principles that have helped us understand the business cycle. The second tool below is our Recession Signal - excerpt from the VP Cookbook, June 2021. Getting recessions right in real-time is one of the most important ways for investors to protect capital. Recessions are non-linear processes that represent a regime change in the economy and markets. When economic stress and market stress occur at the same time, they often get caught in a feedback loop that very quickly tips the economy into recession.
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Tools that have helped us the most #2
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This is the second post in a series where we share the best tools and principles that have helped us understand the business cycle. The second tool below is our Recession Signal - excerpt from the VP Cookbook, June 2021. Getting recessions right in real-time is one of the most important ways for investors to protect capital. Recessions are non-linear processes that represent a regime change in the economy and markets. When economic stress and market stress occur at the same time, they often get caught in a feedback loop that very quickly tips the economy into recession.