Build a Recession-Proof Portfolio: One Dividend Stock to Consider

Recessionary Times, Procter & Gamble, and Weekly Activity.

What is Happening in Our Economy?

Long-term investors have heard it all for the past 1 1/2 years… and many years during our last bull run, bears calling for the next major sell-off/drawdown or economic downturn (“sell everything, run for the hills!”). If you want to know more on where I stand on this, I’d suggest giving my pinned publication “The Stock Market, Rigged in the Long-Term Investors Favor?” a brief read. I emphasize and show valid statistics and facts why bears/perma bears never end up winning over the long run; essentially, highlighting how the long-term investor with a 20+ year time-horizon comes out on top. Unfortunately, us long-term investors, have gone through the gauntlet for almost 2 whole years and our portfolios have been plagued with volatility. Now… I’m not a macro economist or one that likes to get my “crystal ball” out and start predicting what’s going to happen next, but the short-term doesn’t look too promising.

I will always be a bull on the U.S. economy and being invested in quality businesses/funds for the long-term. No matter what has happened in the past, the economy and market has always recovered, and recovered to all-time highs. I know this has been a long, difficult, and stressful bear market for everyone… it truly sucks! However, I do believe it’s going to last a bit longer now with the banking crisis that arose. I’m not here to make predictions on what’s going to happen with our financial system, what the FED will do, or macro-outlook, BUT this incident will likely have a ripple effect across the industry. Primarily, smaller financial institutions that overextended themselves.

Moreover, “inevitable recession” is being tossed around much more now because of this. For the record, a recession has always been on the back of my mind, even without the banking crisis. Before all this chaos, I personally believed we would have a “soft landing” or a mild but impactful recession. Now with the banking crisis at play, I think the chances are higher and accelerated… if we do, it’s just a matter of when and how bad this will actually get.

A soft landing is the process of an economy shifting from growth to slow growth to potentially flat, as it approaches but avoids a recession. It is usually caused by government attempts to slow down inflation.

Bears are eventually going to be right at some point, since that’s all they talk about 24/7… the doom and gloom that will eventually happen (even a broken clock is right twice a day). If a recession does come to fruition, it’s important to understand it’s all part of being in a healthy economic cycle. Recessions and bear markets are normal for economies and markets, it’s just what happens. As bad as that may sound, it’s actually a good thing. Nonetheless, I’m afraid the bears dreams may be coming true, but this needs to be looked as a positive for long-term investors; because this would potentially present great opportunities to accumulate. So, with a quick abstract, I want talk about recessions and what you need to know and why they occur…