Wealthion, Released on 5/25/23

For Part 2 of this interview, CLICK HERE

Michael Pento predicts a “liquidity crunch” causing a severe economic downturn in the coming months, due to disinflation and slowed growth. This could lead to negative nominal prints for Q2, Q3, and Q4 of 2023, signaling an official recession and significant fall in financial averages. Pento observes an over-leveraged global economy, fueled by “free money” and low interest rates, leading to record inflation and asset bubbles. He indicates that non-financial business debt is now 75.8% of GDP, higher than before the global financial crisis. According to Pento, we’re moving from rapid inflation to disinflation, primarily due to a decrease in money supply growth rate. The Federal Reserve’s policy of money printing and loan encouragement has led to this shift. The Federal Reserve’s increase in federal funds rate and contraction of bank lending standards following the banking crisis has contributed to the economic tension. With the current debt levels, Pento suggests that the economy could be more vulnerable to rising interest rates. Pento’s model predicts that the current disinflation will transition into deflation and recession in the near future. He suggests using a five-sector investment strategy based on the inflation spectrum for financial positioning during these changing economic conditions.

Michael Pento is a specialist in Austrian economics and is the President of Pento Portfolio Strategies. Prior to starting Pento Portfolio Strategies he served as a senior economist and VP of the managed products division of another well known financial firm. Michael has also created ETFs and UITs that were sold throughout Wall Street. Earlier in his career, he worked on the floor of the NYSE. He is the author of The Coming Bond Market Collapse: How to Survive the Demise of the U.S. Debt Market.

Adam Taggart is the Founder of Wealthion. He is also Co-Founder and former President of Peak Prosperity. Adam is an experienced Silicon Valley internet executive and Stanford MBA. Prior to partnering with Chris Martenson (Adam was General Manager of our earlier site, ChrisMartenson.com), he was a Vice President at Yahoo!, a company he served for nine years. Before that, he did the ‘startup thing’ (mySimon.com, sold to CNET in 2001). As a fresh-faced graduate from Brown University in the early 1990s, Adam got a first-hand look at all that was broken with Wall Street as an investment banking analyst for Merrill Lynch. Most importantly, he’s a devoted husband and dad.