Navigating Investment Strategies in Stagflation and Deflation Environments

Michael Pento, president and founder of Pento Portfolio Strategies (PPS), joins Julia La Roche on episode 167 to discuss the current state of the economy and the potential risks ahead. 

In this episode, Pento highlights the rising inflation rate, the burden on the middle class, and the unsustainable levels of debt. Pento predicts a slowdown in GDP growth and the possibility of a negative quarter in the second half of the year. He believes that the Federal Reserve will be forced to lower interest rates and engage in quantitative easing to stimulate the economy. 

Pento also discusses the potential impact on the housing market, equities, and the bond market. He suggests overweighting energy, base metals, and gold in a stagflationary environment.

Links: 

https://pentoport.com/

https://twitter.com/michaelpento

00:00 Intro and welcome Michael Reno

00:54 Macro view, inflation, and the bankrupting of the middle class

4:08 If rates don’t come down the economy is in trouble 

5:49 Fed rate cuts ahead this year? 

8:00 Market is massively overvalued 

9:36 Stagflation and how to invest in that environment 

11:32 Home prices 

13:50 Why Powell can’t wait to end QT now 

15:23 Long-term yields might not come down

16:00 Explosion of rates in high-yield will crush the economy

17:27 Gold 

20:00 Erosion of the middle class