Thoughtful Money with Adam Taggart

30% Market Correction + Recession 'Baked In The Cake' | Steve Hanke

25 snips
Mar 30, 2025
In this engaging conversation, Steve Hanke, a renowned economist from Johns Hopkins University, and Mike Preston, a skilled financial advisor, dive into the looming recession and the Federal Reserve's role in income inequality. Hanke predicts a potential 30% market correction and discusses the implications of a shrinking money supply. They tackle challenges posed by economic stagnation in Europe and China's struggles. Additionally, they share insights on gold as a safe haven investment, emphasizing proactive strategies for uncertain markets.
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INSIGHT

Money Supply and Recessions

  • Money supply changes drive economic activity and inflation.
  • A contraction like the current one has only happened four times since 1913, always followed by recessions.
INSIGHT

Regime Uncertainty vs. Uncertainty

  • Regime uncertainty, like during the New Deal, disrupts the economy more than spot uncertainty.
  • This uncertainty makes investors hesitant, as seen with the abrogation of the Gold Clause during the Great Depression.
INSIGHT

Global Economic Assessment

  • Tariffs are ineffective and disastrous for the economy.
  • Europe's economy has flatlined since 2008, and China's deleveraging and slow money supply growth pose challenges.
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