Stock market a massive bubble owned by Federal Reserve, market analyst tells RT’s Boom Bust
The US Federal Reserve started buying corporate bonds this week as part of a $250 billion program funded by the CARES Act. The move aims to backstop corporations and their employees.
Boom Bust talks to Michael Pento, president and founder of Pento Portfolio Strategies, about the regulator’s extreme measures to save the US stock market from bottoming out.
“This is what’s happening: the Fed now owns the Treasury market, the municipal bond market, the corporate bond market, the junk bond market, the CLO market, and by proxy the real estate market and the stock market,” says Pento, adding: “They are all in a massive bubble, owned by the Federal Reserve.”
“The Fed is trapped, they can never unwind this balance sheet, it’s going to grow and grow until we stagflate our way to oblivion… We should be very concerned,” said Pento.
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