Early to Rise

The US stock market underwent it's first 10% correction in 2018, and now stocks are on the edge of all-time highs, and driven higher by corporate earnings.

But, with global trade tensions growing day by day, rising short-term interest rates, and indications of moving into the late phase of the business cycle, a stock market decline may be on the horizon.

Indeed, Paul Tudor Jones, a hedge fund investor famous for predicting the 1987 stock market crash, is expecting a market crash as soon as 2019. He told Goldman Sachs, that "We have the strongest economy in 40 years, at full employment. The mood is euphoric. But it is unsustainable and comes with costs such as bubbles in stocks and credit." Jones isn't the only one predicting an imminent crash. Scott Minerd, Global chief investment officer and chairman of investments for Guggenheim Partners, told Times that, "The markets are potentially on a collision course for disaster." The majority of financial experts seem to agree: the economy has been too strong for too long, and now, something's got to give.

So, how can you prepare for the inevitable down turn? Here are six tips to help you protect your income in the case of a stock market decline.

Invest for the Long Term

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While what goes up must come down, the opposite is also true when you're talking about the stock market. Though the stock market rises over longer periods of time, it's often interrupted by short-term downturns. The short term is ruled by investor confidence, meaning changes can happen quickly. But the long term tends to be more about real wealth creation as companies generate free cash flow and pay down debt. So, your short-term plays should only make up a small portion of your overall investment portfolio, as these can be more subject to damage in a volatile market.

Invest in Individual Companies Instead of Indexes

If the market begins to fall, it's best to have your money in individual companies that you believe in, instead of allocating money to an investment fund that tracks an index. Francis M. Kinniry, head of portfolio construction at Vanguard, told the New York Times that, "It's not an active versus index story, it's high cost versus low cost. They underperform because they're charging too much for the 'alpha' they generate," he added, referring to the return in excess of the market return.

Have as little debt as possible

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Debt only gets harder to pay off during a decline in the market. Make sure that you aren't spread too thin on margin (borrowed funds to invest with) when a market crash starts to look likely.

Invest Globally

After the last market crash, Europe and Japan were slower to recover than the United States and therefore still have years to go before they crash. Darrell L. Cronk, president of the Wells Fargo Investment Institute, said that the recoveries in Europe and Japan started closer to 2014, as opposed to 2009 in the United States. So, your money may actually be safer invested overseas.

Diversify your Investments

As the saying goes, don't keep all your eggs in one basket. Make sure you don't have all of your money tied up in one place, because then a sudden drop could mean financial disaster. Instead, diversify your stock portfolio, and diversify across different asset classes and regions as well. How you invest depends on your risk tolerance, time horizon, and long and short term goals. Careful diversification can be one of the best tools to come out of a stock market crash financially intact.

Cash is King


Wall Street Journal

Tying up all your money in the stock market is never a good idea. Make sure you have some cash saved to get you through in case your investments take a hit, or some cash in the money market. Your goal should always be to conduct your affairs so that if you were to get laid off or meet some other unexpected cash expense, you would not be on the brink of disaster.


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Over two years into the most momentous event in our lives the world has changed forever … Some of us have PTSD from being locked up at home, some are living like everything’s going to end tomorrow, and the rest of us are merely trying to get by. When the pandemic hit we entered a perpetual state of vulnerability, but now we’re supposed to return to normal and just get on with our lives.

What does that mean? Packed bars, concerts, and grocery shopping without a mask feel totally strange. We got used to having more rules over our everyday life, considering if we really had to go out or keeping Zooming from our living rooms in threadbare pajama bottoms.

The work-from-home culture changed it all. Initially, companies were skeptical about letting employees work remotely, automatically assuming work output would fall and so would the quality. To the contrary, since March of 2020 productivity has risen by 47%, which says it all. Employees can work from home and still deliver results.

There are a number of reasons why everyone loves the work from home culture. We gained hours weekly that were wasted on public transport, people saved a ton of money, and could work from anywhere in the world. Then there were the obvious reasons like wearing sweats or loungewear all week long and having your pets close by. Come on, whose cat hasn’t done a tap dance on your keyboard in the middle of that All Hands Call!

Working from home grants the freedom to decorate your ‘office’ any way you want. But then people needed a change of environment. Companies began requesting their employees' RTO, thus generating the Hybrid Work Model — a blend of in-person and virtual work arrangements. Prior to 2020, about 20% of employees worked from home, but in the midst of the pandemic, it exploded to around 70%.

Although the number of people working from home increased and people enjoyed their flexibility, politicians started calling for a harder RTW policy. President Joe Biden urges us with, “It’s time for Americans to get back to work and fill our great downtowns again.”

While Boris Johnson said, “Mother Nature does not like working from home.'' It wasn’t surprising that politicians wanted people back at their desks due to the financial impact of working from the office. According to a report in the BBC, US workers spent between $2,000 - $5,000 each year on transport to work before the pandemic.

That’s where the problem lies. The majority of us stopped planning for public transport, takeaway coffee, and fresh work-appropriate outfits. We must reconsider these things now, and our wallets are paying

the price. Gas costs are at an all-time high, making public transport increase their fees; food and clothes are all on a steep incline. A simple iced latte from Dunkin’ went from $3.70 to $3.99 (which doesn’t seem like much but 2-3 coffees a day with the extra flavors and shots add up to a lot), while sandwiches soared by 14% and salads by 11%.

This contributes to the pressure employees feel about heading into the office. Remote work may have begun as a safety measure, but it’s now a savings measure for employees around the world.

Bloomberg are offering its US staff a $75 daily commuting stipend that they can spend however they want. And other companies are doing the best they can. This still lends credence to ‘the great resignation.’ Initially starting with the retail, food service, and hospitality sectors which were hard hit during the pandemic, it has since spread to other industries. By September 2021, the US Bureau of Labor Statistics reported 4.4 million resignations.

That’s where the most critical question lies…work from home, work from the office or stick to this new hybrid world culture?

Borris Johnson thinks, “We need to get back into the habit of getting into the office.” Because his experience of working from home “is you spend an awful lot of time making another cup of coffee and then, you know, getting up, walking very slowly to the fridge, hacking off a small piece of cheese, then walking very slowly back to your laptop and then forgetting what it was you’re doing.”

While New York City Mayor Eric Adams says you “can't stay home in your pajamas all day."

In the end, does it really matter where we work if efficiency and productivity are great? We’ve proven that companies can trust us to achieve the same results — or better! — and on time with this hybrid model. Employees can be more flexible, which boosts satisfaction, improves both productivity and retention, and improves diversity in the workplace because corporations can hire through the US and indeed all over the world.

We’ve seen companies make this work in many ways, through virtual lunches, breakout rooms, paint and prosecco parties, and — the most popular — trivia nights.

As much as we strive for normalcy, the last two years cannot simply be erased. So instead of wiping out this era, it's time to embrace the change and find the right world culture for you.

What would get you into the office? Free lunch? A gym membership? Permission to hang out with your dog? Some employers are trying just that.

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Did you hear about the Great Resignation? It isn’t over. Just over two years of pandemic living, many offices are finally returning to full-time or hybrid experiences. This is causing employees to totally reconsider their positions.

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