Experts are alarmed!
In a recent interview with Fox, The Bear Traps Report founder Larry McDonald sounded the alarm and said that President Biden and the government’s decisions could lead to something called a “cobra effect” happening to the United States economy.
A “cobra effect” is when an entity, such as the U.S. government, tries to solve a problem, such as the COVID-19 pandemic, however it bring about unintended consequences.
In transcript provided by Fox, McDonald warned, “Well, you know, what’s remarkable, Maria, is that in the history of the Republic of the United States, 28 percent of all the dollars ever created were done so in 2020 and 21 – 28 percent of all dollars ever created. So what happens is you have a crisis like either Lehman or COVID. And then there’s a government response and now we’re having a cobra effect where the unintended consequences of government policy are creating a massive shift. I mean, this is such an incredible period to be alive.”
McDonald further explained, “We’re heading back toward the 1970s, 1980s where you really wanted to be long hard assets and value stocks, whereas the previous decade that we just lived through was a deflationary period where financial assets did really well. So stocks, you know, growth stocks and bonds. Now we’re coming in a period where hard assets are going to really dramatically outperform.”