Will There be a Second Wave of Inflation?
No, we expect Consumer Price Index (CPI) inflation will continue to moderate toward central bank target levels in 2024.
Investment Planning
2024 Outlook
The Cambridge Associates 2024 Outlook features our investment outlook for 2024, separated into eight key investment themes.
Shelter from the Storms: Diversification and Opportunity for Pensions in Insurance-Linked Securities
We believe insurance-linked securities can be a good fit for many pension funds looking to diversify their portfolios. This paper shares insights on how pensions can confidently underwrite and implement this asset class.
Israel-Hamas War Highlights the Importance of Diversification
The devastating loss of life resulting from Hamas’s surprise attack on Israel is at the forefront of our concerns. Risk of a prolonged conflict in the region has grown, creating a new layer of uncertainty on many fronts, including the global economy and markets.
Liquidity Hazard Planning for Families of Wealth
Consistently revisiting potential liquidity risk is important work for family investors. To manage liquidity risk, families should employ best practices, monitoring illiquid investments, spending needs, and currency considerations. By doing so, they can guard against unanticipated stressors and remain on track to achieve their investment goals.
Simplifying Family Investment Portfolios
For families of significant wealth, complexity is a natural byproduct of a well-managed portfolio, but there is such a thing as overcomplexity. This paper discusses a range of best practices to consider if and when a portfolio is encountering sluggishness, inefficiency, or ambiguity.
Euro Area Sinks into a Technical Recession
The latest estimate of first quarter GDP indicates that the euro area fell into a technical recession.
US Debt Ceiling Deal to Weigh Modestly on Already Weak Economic Growth Outlook
US President Joe Biden and House Speaker Kevin McCarthy finalized an agreement in principle to suspend the US debt ceiling through January 1, 2025. The agreement removes the possibility of an unprecedented default, provided it is signed into law, however it still modestly reduces expected government spending and will likely result in tighter near-term liquidity conditions. Taken together, the compromise slightly increases the risk of recession in the United States, which we already viewed as likely.
Should Investors Alter Portfolios in Response to Debt Ceiling Risks?
No. We think most investors should not alter portfolios based solely on debt ceiling risks. Instead, they should remain focused on the long term and rely on the diversification in their existing portfolios. But given the potential for additional stress in funding markets, investors should ensure they have ample liquidity to meet upcoming capital calls and spending needs.
The End of the Fed’s Tightening Cycle Nears
Today, the Federal Reserve raised the Fed funds target range by 25 basis points (bps), to 4.75%–5.00%, as expected, and signaled it expects at least another 25 bps of additional rate hikes will be necessary to bring down inflation. This announcement and the recent turmoil in the banking sector increase our confidence that the Fed is nearly done tightening.