As Paul Kedrosky points out in his blog, there are some segments in the economy that are more recession proof than others. He gives this chart by Nielsen.
From what he suggests, go long pasta and short KO and PEP. I'll go ahead and say that nothing is recession proof. MCD reported today a great quarter but there are still worries about the upcoming quarters and how unemployment will affect their numbers. Are people really questioning the dollar menu? Is that not recession-proof enough? WOW. Times are tough. Be picky. Be nimble.
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2 comments:
The dollar menu isn't such a great deal if the weak economy brings down food prices.
I don't particularly like the term recession proof because it implies that investing in those companies won't give you a negative return but as you can tell by this bear market nothing is really safe. Some stocks just do "less worse" in a recession.
Nothing is recession proof nothing. Recession resistant thats another matter.
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