Mr Elston noted the US and UK economies are presently at a point where they are growing at a rate that is faster than the long-term potential growth rates of those economies.
Economists called this a positive output gap.
Central banks do not like the economy to persistently grow at a rate faster than the long-term average, when this happens, the typical response is to put interest rates up, and this should prevent a credit bubble that develops into a significant recession, though it may cause a short-term, less severe recession.
Speaking at the Treasury select committee earlier this year, Andy Haldane, chief economist of the Bank of England, said it is always better for central banks to put interest rates up when the economy is overheating than to ignore it, as doing the latter leads to a far deeper recession.
Mr Elston said data from the International Monetary Fund (IMF) for the US and Europe including the UK showed those economies have reached the point where they are overheating, and so interest rates will rise.
He said the US is far ahead of the UK in this cycle, but the direction of travel is clear that rates will rise and short recessions will ensue.
The US Federal Reserve has raised interest rates consistently over the past 18 months, while the UK raised the base rate in November 2017.
Mr Elston said the pattern, based on data from the International Monetary Fund (IMF), is for the US to enter recession towards the end of 2019 or the beginning of 2020, with the UK about 18 month to two years behind.
The fund manager said political events, such as Brexit or US protectionism, have the capacity to slow down the cycle, that is, slow down the pace of rates rises, but not to reverse it, and so ultimately political events do not matter very much.
The Bank of Englantd's Mr Haldane told the Treasury select committee the impact of Brexit will be to slowdown the long term potential growth rate of the economy, rather than impact on whether the economy is growing at that rate or not over shorter periods.
Mr Elston has held very little exposure to US equities for most of the past year, and has been systematically selling equities every two months in 2018.
Initially, when reducing his equity exposure, he deployed the cash into alternative assets such as infrastructure funds, but he is now holding more cash and bonds with a short date to maturity.