The US Worker Adjustment and Retraining Notification (WARN) Act stipulates that companies must give their workers an early warning before laying them off. Consequently, the wave of layoffs has not yet impacted jobless claims since most of these workers find alternative employment even before they become jobless.
Some companies are laying off their workers due to artificial intelligence (AI), either replacing some jobs with AI or seeking to hire workers with skills in AI.
At the beginning of 2024, we were in a soft landing environment or mild economic downturn. Today, however, the narrative has changed, and we are in an environment of higher interest rates for longer, and interest rates may even decrease by less than expected later in the year. Based on this, investors must rethink their investment strategy and asset allocation.
At The Family Office, we advise investors to adopt strategic diversification beyond stocks and bonds and to adjust the traditional 60/40 model to include alternative investments such as fixed assets, infrastructure, private equity valuations, or short-term assets.
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