Did you know that you can sometimes tell when a storm is coming by observing changes in animal behavior? Many animals—including birds, cows, sheep, and frogs—are known to indicate through their behavior that a storm is imminent by seeking shelter.
The same is often true with financial markets, with the behavior of major market players indicating possible market turmoil ahead. For example, we’ve been reporting for some time on the potential for a market correction or even recession in 2024—and just recently, billions of dollars in stocks were sold off by the heads of some of the largest companies in the world.
CEOs are selling off millions of dollars of their own stock.
According to Fortune, Jeff Bezos, Mark Zuckerberg, and Jamie Dimon are among the billionaires selling off billions of dollars of stock. Amazon founder Bezos might be the most notable seller in the group, cashing in $8.5 million of Amazon stock in the last month alone. JPMorgan Chase CEO Dimon sold $150 million in company stock. Meta CEO Zuckerberg has sold $638 million in company stock since the beginning of February 2024.
Going back a little further, in the 15 months leading up to the end of 2023, billionaire Warren Buffet grew his cash and cash-equivalent holdings by nearly $60 billion, creating a record $168 billion “war chest.” Steve Hanke, noted economist and professor of applied economics at Johns Hopkins, says this is a sign Buffett thinks a recession could be coming, saying, “The cash hoard tells us one big thing: Buffett doesn’t think there’s much out there that’s worth buying.”
Likewise, Alan Johnson, a consultant who works with financial services firms and president of Johnson Associates, says that the current protective behavior of the billionaires is likely because of an “anticipation of trouble in the future.”
This may be a sign that our economy is in for a rough landing.
It’s not just the behavior of business icons that signals the potential for rough waters ahead. You can also take them at their word. David Solomon, CEO of Goldman Sachs, and Dimon, the aforementioned CEO of JPMorgan Chase, have both recently expressed doubts that the economy will have a “soft landing” at the end of the current Federal Reserve rate hike program.
During a discussion panel held on February 27, 2024, Solomon said that although the world is “setting up” for a soft landing, many risks remain, such as ongoing inflationary pressure and geopolitical uncertainty. “The market is way weighted to a very soft landing. And when you look at the pattern of facts the last three or four years, it’s hard for me to see it’s going to be that simple,” Solomon said.
Acting before a storm is the best way to protect what matters most.
Home insurance isn’t very helpful when you buy it after a tornado hits. That protection needs to be in place before the worst happens.
The same goes for your hard-earned savings. If markets are headed for dark days, having wealth insurance in place now could make all the difference. Gold is that wealth insurance, helping diversify your portfolio and insulate your wealth from market shocks.
We’re witnessing billionaires acting now to protect their wealth. That kind of proactive attitude is one we may all benefit from adopting.
