October 30, 2019
One money manager is warning that the United States is incredibly similar to a banana republic and because of that, “we are all screwed.” Michael Pento says that the central bank is panicking and if they happen to stop “juicing” the system, the entire thing would collapse in an economic depression.
“It’s not that it’s QE. It’s QE on steroids,” Pento said of the Federal Reserve’s actions. “Everybody knows that this QE is permanent just like any banana republic would do, or has done.” According to a report by Market Watch, the Federal Reserve is expected to once again lower its benchmark interest rate this week by 25 basis points. This would be the third such cut in three months. According to the minutes from the Sept.ember 17-18 meeting, “downside risks had become more pronounced since July,” yet “several participants” wanted the Fed to provide more clarity on when the response to those risks, including “trade uncertainty,” would end.
With all the imbalances in the system, Pento says the Fed is well aware the next recession won’t be a mild one, so it keeps pumping to avoid that fate. “The plunge in the stock market would be huge and from a much higher level,” he said. “Back in the Great Recession, unemployment claims spiked. We had millions of people laid off, and the same thing would happen today only… much worse.”
Below is the full interview:
This article was posted: Wednesday, October 30, 2019 at 5:02 am