Most people are aware of the basic tenets of Ivan Pavlov’s experiment with dogs. A ringing bell signaled feeding time, and after a while, the dogs would begin to salivate at the sound of a bell. From the end of the Global Financial Crisis, investors had been conditioned similarly to buy anytime the stock market fell by a meaningful amount. The more aggressive one became during these dips, the more they were rewarded in short order. This year has broken that positive feedback loop, maybe for a while.

Markets are difficult. Anyone who says differently is a fool or a liar. Entering this year, many were looking at the potential for inflation to rear its ugly head. However, it has been hard to capitalize. Imagine this: on January 1st, 2022, you were given all the future inflation readings for the year. How would you have invested your money? Gold? Bitcoin (“digital gold”)? Inflation-protected government bonds? The correct answer, and its implications, may surprise you.

In the middle of a housing boom, especially during a period of high inflation, many people are tempted to explore the idea of investing in real estate. Real estate tends to carry a certain allure due to the concept of passive income, but talk to anyone who owns rental property, and they will tell you it is anything but passive. Like everything else, this decision is not entirely straightforward, and one should be aware of the costs and risks before jumping in.

It is at the tip of everyone’s tongue. It is the lead story every night on the news. Of course, I’m talking about a recession. Beyond the sensationalist headlines and the actual financial pain felt by millions of Americans lies the question: “What can I do about it?” A pragmatic approach shifts the focus from worrying to doing. These periods are never fun for anyone involved, but they are expected throughout history.