Summary
This white paper presents an investment outlook for 2024, focusing on the quality of investments as a mild recession is anticipated. The document outlines the current economic environment, which has shown resilience through the third quarter of 2023, supported by consumer activity. However, it warns of potential bearish threats, including geopolitical risks, persistent inflation, and U.S. political dysfunction, which could negatively impact economic growth. The paper discusses the implications of these factors on insurance portfolio management, suggesting that insurers should align portfolio durations with liability targets and maintain a neutral stance on equity positions. It also highlights the role of artificial intelligence as a potential factor that could mitigate the recession's impact, while emphasizing the importance of a strong economy for overcoming future challenges. The document concludes with a note on the significance of corporate credit as a source of risk and income for insurers.
