The International Monetary Fund, or IMF, recently slashed its growth forecasts for the U.S. for this year and next. The IMF lowered its expectations for growth from 2.3% to 2.1% for this year, and from 2.5% to 2.1% for 2018.
Needless to say, this is far below the 4% growth target that has been discussed in recent months and it remains stubbornly below the 3% mark.
The IMF listed numerous factors regarding its decision to lower forecasts, with a very poor showing in the first quarter of 2017 and ongoing concerns over fiscal stimulus being two of the primary reasons.
Whatever the reasons may be, it would seem that the U.S. is in for a protracted period of sluggish economic growth. This lackluster rate of growth could very well keep monetary policy on the loose end of the spectrum while also meaning potentially lower overall returns for equity investors.
This highlights what could be two major dynamics affecting gold in the coming months and years: First, with poor growth, rates may stay low for longer than anticipated and could even be reduced again at a later date. Secondly, corporate earnings are likely to take a hit in the absence of meaningful economic expansion.
The clock could very well be-and is likely-ticking rapidly for equity market investors. The U.S. could now find itself in a very precarious position as the Fed looks to reduce its balance sheet while growth remains weak and inflation remains elusive.
If you are fully invested in stocks, now may be the time to consider further diversification or even lightening up significantly. It is difficult to imagine a scenario in which stocks can continue to climb as they have in recent years without the economy running at its full potential.
The recent IMF “downgrade” on economic activity is yet another reason we believe that the next major stock market collapse will soon be seen. Fortunately, it seems that investors are getting ample warning this time around. The question is: Will you take action?
Now may be the right time to diversify your portfolio with key assets that may potentially provide a meaningful hedge against a stock market collapse or protracted bear market.
Buying and holding physical gold as part of your portfolio has never been easier than it is today. A simple phone call can help you begin to build a meaningful holding of physical gold that may not only potentially increase in value but may also potentially provide a hedge against a weaker dollar or even deflation.
Speak with an Advantage Gold account executive today about the potential benefits of physical gold ownership. Our associates are here to answer any questions you may have, and can even show you how easy it is to buy and hold physical gold using your IRA account.
Don’t wait for the next major stock market crash before taking action. Explore your options for physical gold ownership today. Call Advantage Gold at 1-800-341-8584 to get started now.Tags: advantage gold, downgrade, fiscal stimulus, gold, growth, IMF, monetary policy