Reasons for optimism

Question: How should investors position themselves in the coming months?

Linda Duessel: I would say to investors that it is normal for a market to have volatility. Two 10% corrections a year is actually historically quite normal. You will have a bear market every now and again. We may or may not have recessions and very, very difficult to be a patient investor, which is what really is suggested, and a diversified one. When you're seeing bear markets in various pockets of the marketplaces. There's some good news to impart here, and so I don't think we need to panic. One is I think that we'll find as we get towards the end of this year, that those terrible supply constraints in goods that have gave us all those empty shelves in this last year and a half, very likely is going to ease up.

Linda Duessel: We are already seeing evidence that's starting to ease up. Who knows? We can have all kinds of sales come Christmas time. Also, don't forget, there was a lot of money printed. Today, consumer balance sheets are in spectacular shape. Corporations are in great shape, too. They may have record debt on their balance sheet, but they have today a record ability to service that debt because most companies who have debt on their balance sheet have debt that's fixed and in most cases, between six and eight years to maturity. So, that is excellent.

Linda Duessel: And truly, whatever damage we've seen to the marketplace this year to date had nothing to do with the earnings of Corporate America, which are spectacular. No, it had to do with the fear of inflation and the worry about the ability of the Fed to fight that inflation and what that has historically meant for the price we're willing to pay for each dollar of earnings. Well, the good news is we've suffered through a lot already, most of the damage is done. Time to put together a shopping list and look for some of those pockets that have been overdone.