5 tips to ride out the downbeat market this holiday season

This forecast is driven by deteriorating structural fundamentals. For example, credit card debt has risen to 2020 levels, with interest rates charged by banks only slightly higher than those observed leading up to the post-2000 dot-com crash. However, the labor force participation rate – or the proportion of the population that is able to work and is working – has still not recovered to pre-pandemic levels. Furthermore, inflation – as measured by the consumer price index – has surged over the past few years.

Economic forecasts indicate that we are headed for greater economic turmoil. The United States is already in a recession and that recession is expected to continue, and the Conference Board forecast further decline in gross domestic product (GDP) by 0.5% in Q4 of this year. It also anticipates that the recession will continue into at least Q2 of 2023. That is before the collapse of the crypto trading platform FTX, which has a profound downstream effect on investment portfolios and non-crypto companies. More optimistic forecasts, such as the Federal Reserve Bank of Philadelphia and S&P Global, are only positive for 2023 in 0.7% and 0.2%each other.

Consumer Debt & Interest Rates in the United States, 1995-2020. Source: St. Louis Federal Reserve
Labor Force Participation in the United States, 1950-2020. Source: US Bureau of Labor Statistics
Consumer price index, 2011-2022. Source: St. Louis Federal Reserve

These macroeconomic indicators are common outside the US as well. Many – even the International Monetary Fund – have designate the rise of inflation as a result of high energy prices in Europe, which is one of the factors, among others, that contributed to our recent European Union. forecast of almost zero GDP growth for all of 2023. It is on top of the long-running demography challenge that there are too many old people out of the workforce and not enough new entrants, which has been dire implication for GDP growth.

Related: The market will not be surging anytime soon – So get used to the dark times

While these macroeconomic fundamentals are out of your control, there is still much that is within your control. We must remember that we have a large agency in our lives and should not be dragged into the tailspin of the economy just because that is what can happen to the aggregate economy – we can still individually flourish when starving.

Here are five tips to do just that.

Optimize the wait. Make the most of your time every day, which means picking up a new skill or taking on a freelance job that spreads your skill set wider. Especially with the advent of artificial intelligence and automation, certain tasks become obsolete and other new creative opportunities appear – and you can leverage the trend by acquiring skills to perform these tasks. There are significant mismatches in demand and supply in certain parts of the labor market, such as artificial intelligence and cybersecurity jobs, so consider picking up new skills that you can put to work.

Reflect and take inventory. It is too easy to look at our situation personally or as a society and worry, but notice what is true and what you are grateful for. The holidays are a great opportunity to do so. By putting your situation in perspective, you avoid many of the mental rabbit holes that can lead you to worry and despair, which unfortunately only exacerbates the challenging situation. Even when things look bleak, remember what you have and what you’ve been through – it will inspire you to keep going.

Grow your network. Building relationships is part of our adventure. Focus on the person as an actual human being, rather than a potential door of opportunity. People are doors, but treating people in a transactional way warps your view of life and ends up closing their doors, because people don’t like being treated as a vending machine. (Would you like it if people only talked to you based on what you can give them?)

Related: 5 reasons 2023 will be a tough year for global markets

Cherish got small. We often focus on big and bright goals or ambitions, but forget what’s right in front of us. We have a lot more agencies than we give ourselves credit for! Whether you take care of your property or write a good report at work, showing excellence in everything you do creates more options in the long run that result in good job opportunities and success.

Always carve out some proportion of your income for savings. Consider investing in structurally sound digital assets. There is no substitute for setting aside resources every month, whether crypto or fiat, that you can get when you need them most. There will always be an element of unpredictability in the world, so consider this savings as your insurance policy on market downturns. Even though crypto has wintered, all assets have struggled as the entire market is in decline. But the future of major tokens, such as Bitcoin (BTC) and Ether (ETH), remains promising, and it will only be a matter of time before they rebound. Moreover, as governments become more volatile and inflation continues to rise, crypto can be a useful hedge and diversification strategy.

Don’t despair even if the economy is shaky. You and your household can still thrive!

Christos A. Makridis is a research affiliate at Stanford University and Columbia Business School and the chief technology officer and co-founder of Living Opera, a multimedia art-tech Web3 startup. He holds a doctorate in economics and management science and engineering from Stanford University.

This article is for general information purposes and is not intended and should not be construed as legal or investment advice. The views, thoughts and opinions expressed here are solely the author’s and do not necessarily represent or represent the views and opinions of Cointelegraph.

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