"My view is that the economy is going to continue to slow down and probably will experience a recession next year," Hanke said.
"The fuel for the economy, to make it simple, is the money supply. And what's going on in the money supply? And if you get significant changes in it, you get significant changes in nominal GDP," he later added.
M2, one class of the money supply, shrank from mid-2022 to March 2024, according to Federal Reserve data. That's a rare trend that's only happened four times over the last century, and has ended in a recession in every instance, Hanke said.
Trump's protectionist economic policies also impose a 'big negative' for the economy, Hanke said.
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