(New York)

Pimco has just gone on the record warning that indicators of a recession are flashing worrying signs. Based on trends in the economy and markets, including inflation, Pimco says it is time for investors to adjust their portfolios. In order to play the looming recession, Pimco suggested five trades. These include: short-term corporate bonds, a basket of EM currencies (Finsum comment: ??), gold, large cap stocks over small, and alternative investments.

FINSUM: Wow, most of these are deeply contrarian (i.e. EM currencies, gold, and large caps). All three of those picks have major headwinds against them. The case against EM currencies is clear but why pick gold when rates are rising, the Dollar is strengthening, and investors have shown zero appetite despite all the volatility?