Peter Schiff has been one of the few voices of reason warning that the Federal Reserve is going to re-start its quantitative easing by mid-2015, as well as keep interest rates at zero until there is a currency crisis. With the recent market turmoil, economists around the world are beginning to realize that Peter is right – more QE is needed. Even St. Louis Federal Reserve Bank President James Bullard says that another round of quantitative easing might be in order. In an interview on Bloomberg, Bullard said:
Is the world waking up to the economic reality Peter Schiff has been warning about all year long? With the current chaos in the stock market and rise in the price of gold, mainstream commentators and economists around the world are starting to wonder if stocks really are in bubble territory. All sorts of technical indicators are driving speculative investors to seek the safe-haven of gold. Take a look at some of these ominous indicators highlighted by the Economic Collapse Blog:
- The S&P 500 and Nasdaq Composite experienced the worst three-day decline since 2011.
- The price of oil is plummeting, which happened just before the 2008 financial crisis. Oil hasn’t been this cheap for two years.
- The Volatility Index (VIX) is at its highest since the European debt crisis, indicating a lots and lots of fear on Wall Street.
Peter Schiff highlights the differences between the Chinese and American economies. More importantly, he explains why China doesn’t want the rest of the world to know how much gold it owns or intends to buy.
Back in September, Peter Schiff was interviewed by Anthony Wile of The Daily Bell. We posted a segment of the interview last week. In this second part, Peter elaborates on the true drivers of the American economy, his strategy for physical precious metals investment, the war on drugs, and the economic troubles of Europe.
Daily Bell: What’s driving the market – fundamentals? We think it’s almost purely monetary policy these days.
Peter Schiff: It’s just cheap money. That’s all that’s driving it. It’s inflation. You can say to some degree it’s about earnings, but earnings are a function of share buybacks. Companies are buying back stock and they only can afford to do that because they can borrow so cheaply, so it’s stock buybacks that are driving earnings from share growth, not topline revenue growth. And of course, the other thing that’s sustaining earnings is that corporate debt service is so low. Despite a record amount of debt on corporate balance sheets, their debt service costs are so low that’s adding to their earnings. That’s the same thing that’s happening with the federal government. Despite the fact that we have a record national debt, the interest payments that we make per year are lower than we made in Ronald Reagan’s presidency, even though the debt was a fraction of its current size and that’s because the carrying costs are so low. I recently completed a 30-page report on this topic called “Taxed By Debt”, with a lot more information than we have time to go into here.
Chris Waltzek invited Peter Schiff onto GoldSeek.com Radio this last week to talk about the rebranding of Euro Pacific Precious Metals to SchiffGold. Peter explains the reasoning behind the brand change and why investors should avoid buying numismatic and collectible precious metals products. He then goes on to discuss his expectations for the US economy for the rest of 2014. He shares his 2014 predictions for the Federal Reserve’s monetary policy, as well as the price of physical gold. Enjoy the audio and full transcript below.
Peter Schiff appeared on Yahoo! Finance yesterday to speak with Jeff Macke about the latest meeting minutes released by the Federal Open Market Committee (FOMC). The Fed has admitted that it does not plan on raising rates soon, officially throwing the United States and the dollar into the arena of the international “currency war.” Read some highlights from the interview below.
Back in September, Peter Schiff was interviewed by Anthony Wile of The Daily Bell. The exclusive conversation covered a vast number of topics, but in the second half they dug deep into Peter’s analysis of the United States economy. Peter, as usual, clearly explains our fundamental economic reality while deftly moving across a range of topics, from the performance of this year’s blockbuster movies to the European Central Bank’s rate cuts.
Daily Bell: What should the Fed be doing these days other than going out of business? What’s it doing wrong?
Much positive economic hay has been made of the job report numbers that were released last week. The number on which everyone focuses is the unemployment rate, which touched a six-year low of 5.9% in September. According to the Bureau of Labor Statistics (BLS), 248,000 jobs were created.
But much of the financial media ignores the other side of the picture. Most importantly, the latest data from the BLS that shows the labor force participation rate at its lowest since 1978 – a disturbing 62.7%! The labor force participation rate refers to people who are currently employed or are actively searching for work. The chart below makes it blindingly obvious that the economy is not on the steady growth track the government would like us to believe.
By Peter Schiff
Yesterday, I launched this new website and announced the rebranding of my gold bullion dealer from Euro Pacific Precious Metals to SchiffGold. I started this company four years ago to provide a trustworthy option for my Euro Pacific Capital brokerage clients, but it has since grown to become a major US gold dealer in its own right. This landmark for my company comes in the midst of a historic time for the precious metals. The past four years have had highs and lows. We have been experiencing the inflation of remarkable new asset bubbles, and gold’s response has been mixed. But I have reason to believe that over the next four years, gold and silver investors will witness shocking macroeconomic events that put to rest any doubts about the importance of having sound money in every portfolio.
Peter Schiff appeared on Fox Business yesterday to debate James Cordier about the state of the United States economy. While their conversation was friendly, Peter posed some tough questions that never got answered.