Preparing for the next recession

We’ve been talking a lot around the office lately about the next recession and how to prepare our clients for that eventuality. It’s part of our job at Azzad, making sure we’re looking ahead to the next big thing or market-moving event. And it’s only natural to talk about what might be ahead because we’re currently living through one of the longest economic expansions on record (120 months and counting). A recession, sometimes called a “contraction,” refers to a decline in economic activity and is a fact of life in the business world. Recessions can trigger steep declines in the stock market, which is one of the reasons we keep abreast of the health of the U.S. economy. We need to know where markets might be headed when the next recession happens, which it inevitably will. It’s not a question of “if,” but “when.” Research shows that although there have been 11 recessions since World War II, only three of them triggered particularly severe market downturns: 1973-1975 (market decline of 48%), 2000-2001 (market decline of 49%), and 2008-2009 (market decline of 56%). We’ve been looking at the causes of each of those recessions/bear markets, and each of them followed a