With the banking sector in crisis, the United States Federal Reserve raising interest rates to the highest levels in over two decades, and the producer price index (PPI) declining at the fastest rate in history, Bloomberg’s expert has warned it all may be leading toward a major economic reset in a year’s time.
Indeed, Bloomberg’s senior commodity strategist Mike McGlone has issued a stark warning of the possible “severe economic reset” by this time next year, as he told the host of the finance YouTube channel Wall Street Silver during an interview published on May 4.
According to McGlone:
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“By the time we speak next year this time, I fully expect we’re going to be in a severe depressionary environment. Unemployment going up, deflation continuing to tick down, and in this current trend, is PPI is dropping at the fastest rate in history.”
Indeed, the PPI has been declining at the fastest rate in its 75-year history, as McGlone shared on April 27 in a tweet citing Alfonso Peccatiello, the founder and CEO of investment strategy firm The Macro Compass, who said that “the bond market was pricing almost 200 [basis points] worth of Fed cuts over the next 18 months.”
As the analyst added in the interview, there is also “plenty of pressure for the Fed to ease, but they’ll never ease with these ahead, and they’re going to start feeling pressure like we’ve had in the past,” citing “death threats” and “threats to ban the Fed,” as unemployment is ticking up and factoring into this reset.
Other projections
Meanwhile, McGlone believes that the trend of gold outperforming platinum and silver will accelerate, as he said usually happens during recessions in the US, predicting its price would go up to $3,000 an ounce and arguing he does not see “anything that stops gold from continuing to outperform.”
Earlier, he has also predicted a major pullback for cryptocurrencies Bitcoin (BTC) and Ethereum (ETH), which he believes would go down under the pressure of the “overwhelming force of the stock market going down with the Fed tightening into a recession,” as Finbold reported on April 21.
It is also worth noting that McGlone’s recession projections go hand-in-hand with those of Robert Kiyosaki, a renowned investor and author of the best-selling personal finance book ‘Rich Dad Poor Dad,’ who has repeatedly alerted his viewers of the strong chance of an ‘economic tsunami’ coming to sweep the US, as well as the rest of the world.
Like McGlone, Kiyosaki is bullish on gold, as well as on silver, Bitcoin, and Wagyu beef, which he believes are all better alternatives to stocks, exchange-traded funds (ETFs), and fiat money like the US dollar, or ‘fake money’ and ‘toilet paper’ as he often refers to the American national currency.
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