Stagflation: The Worst Case Scenario

Ed Butowsky has an important article over on the Fox Business web site about a phenomenon that investors should be concerned about: Stagflation.

Butowsky is one of America’s foremost wealth managers. He only provides services for the top 1% of Americans in terms of assets and income. He counts among his clients some of the wealthiest professional athletes in America.

Now some background on the topic of Butowsky’s article: Stagflation is the combination of a rising cost of living and stagnant economic growth. It was a term introduced in the 1970s when the phenomenon first appeared. The most important thing to know about stagflation is that it is terrible for stocks and bonds and very good for hard assets.

During the stagflation of the 1970s, the S&P 500 fell 45%, while the price of gold tripled, sending rare gold coins even higher.

Butowsky says that inflation is coming back and makes the case for that forecast in an article entitled “Ready or Not, Stagflation is Here.”


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