🦹‍♀️Curvy yield gal 🦹‍♀️

Hey friends,

Welcome to Better Have My Money, my Monday night newsletter about stocks, investing and figuring out how to protect your money

I’ve been MIA for several weeks while covering the horrors of the breaking news cycle, which left me with little energy to then talk excitedly about a possible looming recession.

But, today I appeared on BuzzFeed’s AM to DM morning show to talk about how to protect your moolah when the economy collapses, using a lot of hand snakes to explain a recession. And I remembered how exciting money is, even if my shares are down 7% in the last month.

Last week there was a lot of chatter about the inverted yield curve (sexy!) and the fact that the last five time it happened, a recession occurred sometime in the year or two after.

  • Confusing term of the week: “inverted yield curve” — basically when bond investors, who loan money to companies and governments, have little faith in long term growth of the economy. For further info, check out this great Twitter thread.

The last recession, known here in the US as the Great Recession and known in Australia as the Global Financial Crisis (I’ve mentioned “the GFC” here before to blank stares), was the second worst recession in history, only beaten by the Great Depression, where unemployment was over 25%. And some — including Ben Bernanke, who was chair of the Federal Reserve during the 2007-2009 Great Recession  — claim it was a bigger disaster.

Which means that any talk of recession, rightly, has people freaking out. I graduated from university in June 2009, as newspapers were shutting down left and right. It was a seriously crappy time to be released out into the world, and nearly all of my friends from college ended up working in non-media industries.

But recessions are normal! Not super fun, but normal.

Loosely classified as economic downturn over six months, a recession normally sees unemployment numbers rise, wages stagnate, house prices drop and the stock market to drop.

Here’s some of my general tips for taking care of money during a recession:

  • Get your savings up. Recessions are a big time for layoffs, so get your fuck layoffs fund ready. If you don’t have one, open a high-interest savings account from an online bank — preferably not one where your checking account also is so that you aren’t tempted to just switch money from your savings to your checking — and just set up auto-deposits.

  • Pay off your credit card debt — I would focus on credit card debt over student debt, since who KNOWS what’s gonna happen with student debt after the 2020 election, so pay it as scheduled but put extra focus on disappearing the credit card debt cause those interest rates are a nightmare and no the points do not make it worth it!

  • If you’ve got stocks — don’t touch them. Rebounds AFTER a big drop are super important and you need your money in there for the big rise. Plus, the stock market often recovers before a recession is officially declared over, so if you’re busy trying to time it and buy again as the growth starts, you’ll be too late.

  • But diversify if all your investments are in just one company! This is not OK at any time, but particularly when things are fraught.

  • Think about what you might want to buy while things are down, since the inevitable growth will one day return and it’d be great to head into post-recession life with a bunch of bargain stocks that will then spend the next 10 years jumping like crazy.

  • Chill. It is always embarassing watching investors (mainly men) freak out and sell everything. Just stay calm, particularly if you’re young and you still have plenty of years to weather any ups and downs.

  • And as my mate Pat said (I’ve never seen someone more obsessed with budget spreadsheets than Pat, he knows where EVERY dollar he spends goes) “We live in the shadow of 2008. The next recession will likely not be anywhere near as bad.”

How are you getting recession-ready? Reply and let me know, and unlike the last six weeks I will stop ignoring my inbox.

And for years now, Native Hawaiians have been protesting a planned observatory on Mauna Kea, the state’s highest peak and sacred indigenous land. Protests have ramped up after a court ruling that the telescope could be built, and it’s amazing watching the movement develop. You can contribute to the bail out fund for any of the protectors of the mauna here.

Hope all your curves are verted,

Amber Jamieson

Better Have My Money is on Twitter @bhavemymoney, so please tweet nice things (aka the link to our sign up page) and tag us. Got a mate who is recession stressed? Forward this onto them and tell them to subscribe. If you sign up to Acorns, use my sign up code to join and we both get $5.

As always, if you've got any questions about stocks, this is a shame free zone. Just reply and ask away.