How I will profit from a major global recession with this trade
In my opinion, the global economy is heading into dark times. I have revised my initial position of shorting equities to a much smaller position and instead will be going long government credit via TLT. What's nice about this speculation is it pays you to own it vs the other option of shorting equities.
The banking crisis has shown the cracks in the global economy. Not just in the US but globally. Yield curves from Germany to Canada are completely inverted. Typically liquidity is in the highest demand during the Spring and Fall. I expect this trade to pay off in late Q3 or Q4 of this year. The yield curve does NOT lie! It is predicting a major US recession. What we just saw with the regional banks in the US and Credit Suisse is just the start. During that crisis, we once again saw how bonds were massively in demand as people scrambled to get liquidity through safe assets.
There is nothing more technical about this trade than support and resistance and price action. This is a fundamental trade. A trade that I will be extremely aggressive with on my sizing as I believe the probabilities are very high.
The banking crisis has shown the cracks in the global economy. Not just in the US but globally. Yield curves from Germany to Canada are completely inverted. Typically liquidity is in the highest demand during the Spring and Fall. I expect this trade to pay off in late Q3 or Q4 of this year. The yield curve does NOT lie! It is predicting a major US recession. What we just saw with the regional banks in the US and Credit Suisse is just the start. During that crisis, we once again saw how bonds were massively in demand as people scrambled to get liquidity through safe assets.
There is nothing more technical about this trade than support and resistance and price action. This is a fundamental trade. A trade that I will be extremely aggressive with on my sizing as I believe the probabilities are very high.