Peter Schiff: The Fed is Dove in Hawk’s Clothing

After Janet Yellen’s speech at Jackson Hole last week, gold stocks sold off on the Chairwoman’s “hawkish” tone. It was once again an overreaction and misinterpretation of the Fed’s real impact on the economy.  In his latest take on Yellen’s speech, Peter Schiff explains why the Fed’s “hawkish” talk is just a front to keep the markets anticipating action. In any case, Peter explains, the decision to hike or not will have little effect on the economy.

Highlights from the podcast

“For a small person, Janet Yellen certainly casts a large shadow over the financial markets. Everybody was on pins and needles. All the traders were there with their fingers on the buttons waiting to react to anything that Yellen said”

“Nobody cares what the numbers actually are. They only care about what the Fed is going to say about the numbers. What they say, supposedly, indicates what they might eventually do. So, it all boils down to ‘what is the Fed going to do?’ Nothing is real. Nothing else matters.”

“I want to examine whether anyone on the committee could be considered a hawk. A hawk is predatory, is to be feared – reflecting a tough central banker who believes in sound money. On the other hand, a dove is cute and fluffy, it doesn’t really hurt anybody. A dove wants cheap money – keep interests low so as not to harm anybody – nothing to fear.”

“When it comes to hawks with respect to the Federal Reserve, the bird is extinct. They are all doves and the only difference is the degree of dovishness. The hawks are gone and are probably never coming back. Yellen was not a hawk, and neither was Stan Fischer.”