The U.S. economy is facing what Ark Invest CEO Cathie Wood calls a “rolling recession”—a slowdown that hits different sectors at different times rather than all at once. While headlines may be dominated by warnings of slowing growth, job insecurity, and falling consumer spending, the bigger picture for long-term investors may be more hopeful than it seems.

As fears of an economic downturn rise, many Americans are retreating into cash savings, cutting spending, and preparing for a few potentially negative quarters. But for many investors, now might be an ideal moment to reallocate their portfolios—especially toward alternative assets like gold.

A Rolling Recession and the Fed’s Next Move

Cathie Wood told Bloomberg this week that the U.S. economy is experiencing a rolling recession largely due to a collapse in the velocity of money—a measure of how quickly cash circulates through the economy. With Americans choosing to save rather than spend, Wood believes the U.S. may post one or two negative GDP quarters.

While that might seem alarming on the surface, it could create the runway the Federal Reserve needs to cut interest rates later in the year. The Fed has already signaled its willingness to shift to a more dovish stance, forecasting two rate cuts in 2025 if economic conditions continue to soften.

Wood believes the Fed may have “many more degrees of freedom” than Wall Street expects, especially as inflation continues to cool, with food, energy, and housing prices showing signs of relief. With innovation driving what she calls “good deflation,” Wood predicts two to three rate cuts this year—or more.

Trump’s Return and Pro-Growth Policy

The return of President Trump to the White House brings with it the real potential for pro-growth, pro-investor fiscal policy—particularly in the form of tax cuts. If implemented, these cuts could offer a stimulus for both individuals and businesses, further shaping a low-rate, low-tax investment environment.

In a typical recession, policymakers have fewer tools at their disposal. But with rate cuts and tax cuts on the table, this downturn might look very different than previous cycles. That’s why investors are rethinking their strategies—not only to weather short-term volatility but to capitalize on new macroeconomic conditions.

Why Gold Shines During Uncertainty

As economic uncertainty looms and traditional equities fluctuate, more investors are considering the role of gold in a diversified portfolio. Historically, gold has served as a hedge against inflation, market volatility, and currency devaluation. But in today’s landscape, it offers even more:

• Store of Value: With the U.S. dollar under pressure from rising debt and global diversification, gold retains intrinsic value regardless of central bank policy.

• Safe Haven During Rate Cuts: When the Fed slashes rates, real yields tend to decline, often sending gold prices higher.

• Non-Correlated Asset: Gold doesn’t move in lockstep with the stock market, making it a powerful tool for portfolio protection.

And with DoubleLine Capital’s Jeffrey Gundlach warning that a recession has a greater than 50% chance of arriving in the next few quarters, it may be time to consider where your assets are exposed—and what’s truly protected.

Investors Are Looking Beyond the U.S.

One of the most notable shifts this year is the decline in confidence around “American exceptionalism” in global markets. While U.S. stocks have long been the default growth engine for investors, the recent turbulence has many looking elsewhere—including Europe, emerging markets, and alternative assets like precious metals.

As Gundlach put it, “It’s probably time for investors to diversify away from U.S. assets.” For those looking to do just that, gold and silver remain among the most time-tested options.

Gold in a Post-Recession Recovery

If Cathie Wood is correct and the Fed cuts rates aggressively while the Trump administration rolls out tax relief, precious metals could experience a surge in demand. A low-rate, inflation-cooling environment paired with global economic realignment has historically created fertile ground for gold price appreciation.

Whether you’re hedging against a downturn or positioning yourself for the next bull cycle, gold remains a reliable pillar of long-term retirement planning.

To learn how you can protect your wealth and retirement savings with gold and other precious metals, contact GoldenCrest Metals today. Their team of experts can help you explore tax-advantaged strategies to diversify your portfolio and navigate market uncertainty with confidence.

Source:

https://news.yahoo.com/news/finance/news/cathie-wood-says-us-rolling-170119911.html