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Focus on Assets Providing Defined Returns in Economic Uncertainty
In times of economic uncertainty, it is critical to focus on assets that offer defined and predictable returns of the capital invested, such as short-term government bonds. Concerns should also extend to the risks of deflationary conditions where asset values may not be sufficient to cover debts and living expenses in the future. Investing in longer-dated Treasury Inflation-Protected Securities (TIPS) at a real interest rate of over two percent is advised in the current environment to secure returns. It is suggested to maintain holdings in government bonds, particularly inflation-protected ones, and continue to capitalize on income-producing assets due to their stability and potential benefits.