Peter Schiff: Trump Is Setting Himself Up as the Fall Guy (Video)
Peter Schiff recently appeared on InfoWars with Alex Jones and took on the notion that Pres. Trump is in the process of fixing the economy. In fact, Peter pushed back hard against Alex, saying we are on the verge of a crash and Trump is going to get the blame.
I agree with you. The economy is going to blow up. But it’s going to blow up like a bomb. It’s not a good thing. It’s a bad thing. Unfortunately, that’s what Trump has inherited from Obama. But it’s not even really just Obama. It’s the Federal Reserve. It’s the monetary policy that has been passed like a baton from Clinton, to Bush, to Obama, and now to Trump.
Peter predicted the collapse will happen under Trump’s watch. Peter has said in the past that Trump is not helping himself by taking credit for the soaring stock market. And when things go south, he’s going to get the blame.
He owns the stock market bubble. He and the Republicans own the economy now thanks to the tax cuts. They’re not going to make any difference, but they are going to give the Democrats a reason to blame it all on Trump and the Republicans.”
Peter then turned to a theme he’s hit several times in recent podcasts, saying the falling dollar and rising bond yields signal the economy isn’t nearly as good you might think if you just watch stock market prices.
What’s happening is inflation is rearing its ugly head in a big way, and this is going to push up interest rates.”
The budget deficits are going to soar. The trade deficits are at record highs. They’re going to soar. These rising twin deficits, increasing interest rates – its reminiscent of 1987 before the market crashed. The problem is we are more dependent now than we ever have been. The Federal Reserve made the mistake of creating a huge bubble economy that completely depends on extremely low interest rates to survive.”
Alex pushed back against Peter’s narrative, asking, “What was Trump supposed to do?” Peter said he should have stuck to his message as a candidate – admitting that the economy is a mess and the stock market is a big, fat, ugly, bubble. Instead, Trump has taken credit for the economy and the soaring stock market. Now he’s set himself up as the fall-guy.
He campaigned and said [the stock market] was a bubble. It wasn’t his bubble. Now it’s his bubble. That’s the problem. But if he would have said, ‘It’s a bubble, it’s going down,’ it wouldn’t have been his fault, because part of the cure for the economy is deflating these bubbles. It has to be done. Someone has to rip this band-aid off.”
Peter said George W. Bush was in a similar situation.
He inherited a bubble. Instead of leveling with the American public, he pretended everything was great. And then the bigger bubble that was inflated while he was president collapsed, except that he got a second term because his bubble didn’t really pop until the end of his second term. I think Trump’s is going to pop during his first term because this one is much bigger and we don’t have as much time.”
Peter went on to explain how he thinks things will go down. Rising consumer prices and rising interest rates are going to create significant headwinds for the economy. All of the cheap money will eventually go away, weakening the economy further. The Fed will see this. If it continues to raise rates, the economy will go into recession. But will the Fed be willing to let that happen? Most likely not. The central bankers will more likely call off the rate hikes in hopes of protecting the stock market bubble. That will set off a currency crisis.
The dollar will plunge. Not just make new lows, but destroy the old lows and that will set off an economic crisis that’s far worse than the financial crisis … When the dollar collapses, it wipes out the middle class. People are going to be impoverished and they are going to blame Trump.”
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