Massucci's Take: Beware of inflation?

Updated

The Federal Reserve this week again pledged to keep interest rates close to zero, which means borrowing money remains cheap for banks. What, though, does it mean for U.S. stocks and economy?

"Interest rates are artificially low," said Michael Pento, chief economist at Delta Global Advisors in Huntington Beach, Calif. "They don't belong at zero percent."

If rates stay low for too long, economists including Pento are saying, a bit more loudly: Beware of inflation. If indeed inflation does spark, the economic recovery would stall and stocks would drop.

Advertisement