The middle part of the yield curve has inverted. Over the past few weeks, the 3 month/10 year has inverted.
This has sparked a recession fear in the US. Typically, the yield curve inversion precedes a recession by months and sometimes years. As of right now, there is nothing to indicate a recession in the near future. However, if the yield curve keeps inverting and stays inverted, stress will build and a recession will occur. I still believe the US market can rally further in 2019.
I am building a sizable cash position for the future. When the recession occurs, the Federal Reserve will expand the monetary base. This has been their modus operandi. Stocks, commodities and real estate will benefit.