The Federal Reserve is shrinking its multi-trillion dollar balance sheet.

That's set to cause stocks to drop, according to Nomi Prins, author of the new book Collusion: How Central Bankers Rigged the World

"The shrinkage of the balance sheet will create a situation where rates will by definition be a little bit higher," she said, adding that higher rates make it more expensive for corporations and individuals to manage debt. "As a result of that, they will take money out of the stock market and that will cause more volatility."

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