Political Prisoners, US Economic Delusions, and Escaping the Next Crisis (Video)
In his latest appearance on Alex Jones’ InfoWars, Peter Schiff began by discussing the tyrannical imprisonment of his father Irwin Schiff. They went on to discuss the economic predicaments of both the United States government and the average American citizen. In a country crippled by debt and an unhealthy sense of entitlement, Alex and Peter ask the essential question – how can intelligent investors prepare themselves for what comes next? One answer: buy hard assets like physical gold and silver.
Highlights from the interview:
“Nothing has actually changed, but the perception now is that the Fed is about to raise rates in December. Of course, the markets had that perception all year long. They thought they would raise in March, then June, then September, and now they’re convinced the liftoff is going to happen in December. The reason they’re convinced of that is because Janet Yellen spoke both after they failed to raise interest rates in October through their statement, and more recently this week she was testifying before Congress. Basically, what she said was if the economy continues to improve the way they believe it will, and if the labor market improves further, and if inflation – the way the government measures it – gets to their 2% level and they’re satisfied that it’s going to be at 2% in the medium term, then if all these things happen, that it’s possible the Fed might raise rates. That’s all she said. The interpretation was, ‘The Fed is going to raise rates for sure!’ Then when we got the jobs numbers… which were on the surface much stronger than what everybody had been looking for, that sealed the deal…
“I don’t think it seals anything. I still think the Fed is not going to raise rates in December. It’s a possibility, just like Yellen said. Anything is possible. Maybe the Fed will surprise me and raise rates. I think from their perspective, it would be a very dangerous mistake if they did that. I think it would just accelerate the collapse of the markets and that would put them in a very difficult position…
“The last two months [of job reports] were very weak. Everyone was expecting big revisions upward. They were saying, ‘Oh, those numbers can’t possibly be real.’ You know what? They barely revised them. So if you actually look at the fact that we didn’t get the revisions that everybody thought – we just got more jobs in October to make up for the fewer jobs everybody thought we were going to get in August and September. Over the last three months, we averaged 187,000 jobs per month. That is slower than the pace for the first part of the year… Last year’s three-month average was better than 250,000. So the jobs are slowing down…
“All the jobs – about 200,000 of these jobs – were in healthcare and education; they’re in retail – cash registers, cashiers; leisure and hospitality – bartenders, waiters, temporary jobs. We didn’t gain any manufacturing jobs. We lost mining and logging jobs. We lost jobs in transportation. We added the low-paying, service-sector jobs. Here’s a statistic which no one is really talking about with the demographics. All of the job gains went to people over the age of 55. Between 24 and 55, 35,000 jobs were lost. What gets worse, if you just look at men age 24-55 – 119,000 jobs lost by young men. So who gained jobs in this economy? It’s older workers, who would rather be retired… And I think married women, whose husbands can no longer afford to support them, having to go back into the labor force. That’s really what’s going on…
“I think the way this is going to deflate – this bubble – is that the Fed is not going to be able to raise interest rates and people are going to eventually figure out that predicament, because of the Fed’s failure to act. The dollar is ultimately going to turn around, take the bond market with it, push up consumer inflation, push up interest rates, and really put the squeeze on the economy even further. If the Fed actually tries to raise interest rates, then they’re just going to prick the bubble that much faster. So either way, the air is going to come out and we’re headed for a crisis.
“What I think is going to be different about this crisis is this is going to be the final crisis, the final nail in the coffin. It’s going to be a dollar crisis and a sovereign debt crisis, where there are no bailouts. The US government is the entity that’s going broke. The crisis is going to be in dollars, in Treasuries. The government can’t bailout itself. They were able to bailout the banks. They were able to bailout private companies by going deeper into debt and printing more money. But when people finally question the value of that debt and that money, the bailouts end…
“Right now, Americans expect to get taken care of. They think they’re owed something from the government as a birthright. So it’s a much bigger difference when you lose something that you believe you’re entitled to and when you’re giving something and you’re grateful for having been given something…”
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