Today one of the top economists warned King World News that “there will be hell to pay when this tragic collapse begins.” This is an incredibly powerful interview with the acclaimed economist, as he gives KWN readers around the world a look down the rabbit hole that central planners are taking us. Michael Pento then issued this ominous prediction, “This will end in total devastation.”
Pento: “I’m focused on the fact that the Fed and the Treasury are primarily in the process of blowing disastrous bubbles. The economic recovery has been predicated on consumption. That consumption is 70% of US GDP. The consumption is, in turn, predicated on borrowing because we don’t have any real income growth on the part of the consumer.
The borrowing has been predicated on asset bubbles in stocks, bonds and real estate.
“But people have to also understand where these bubbles come from, and the fact is that the whole progenitor of this cycle is the Fed. The Fed does this by providing low interest rates, and monetizing government debt.
So now we have a situation where the FHA is on record saying that they probably have a $1 billion shortfall. Because of this shortfall, the FHA will need to tap the Treasury, which according to Jack Lew is already pretty much tapped out itself.
Read the full interview at KING WORLD NEWS