Analyzing the Business Cycle for Asset Allocation Decisions

As an investment advisor, you are tasked with analyzing the current state of the economy and its progression through various business cycles. Consider the global economic context as of mid-2023, including interest rates, inflation trends, employment rates, and consumer spending. Given this backdrop, explain how you would assess the current phase of the business cycle, evaluating the implications for asset allocation strategies. Additionally, discuss how external factors, such as geopolitical events and technological advancements, may influence the trajectory of the business cycle. Conclude by providing specific recommendations for a balanced portfolio based on your analysis.