EC Peak Growth And Inflation

What all this means is that the rates of growth and inflation are about to slow. This isn't a reason to panic…yet, but it does require a change in your investment allocations.  For now, the deceleration should be at a gradual pace for the remainder of this year, which means bond and bond proxies should start to fare better than the asset classes, style factors, and sectors that are geared towards a rapidly accelerating economy.

However, disinflation and slowing growth could morph into deflation and recession next year. Such macroeconomic conditions should prove devastating for these record asset bubbles. Good money managers must know how to appropriately navigate these cycles. And, most importantly, be able to determine when it is time to sprint for the emergency exit before the real chaos begins. That requires the ability to know when to raise cash, move into short-duration bonds, get the long the dollar, and allocate to a net-short position in equities.

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Michael Pento is the President and Founder of Pento Portfolio Strategies, produces the weekly podcast called,  more

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William K. 2 months ago Member's comment

Interesting and depressing and quite i agreement with what I have been anticipating, except the timing is a bit different. The question is about accountability and control. Who is willing to hold the federal reserve bakers accountable? And who is authorized to implement the firing squad to reward them for their efforts? The damage that has been set into motion is not able to be undone and so it will surely be a rough ride for a while.