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.
The precious metals have been having a hard time recently, especially following Janet Yellen’s press conference last week. While Yellen was extremely vague about when the Federal Reserve would raise interest rates, the financial media latched on to her theoretical discussion of how rates would be raised when the time came. This turned out to be the only part of Yellen’s statement the markets seemed to care about. Even unbiased, legitimate new agencies like Reuters reported that “…the Federal Reserve indicated in its policy statement it could raise borrowing costs faster than expected when it starts moving.” This is the explanation for gold and silver’s latest downturn. Talk about not seeing the forest for the trees.
In his latest Schiff Report video, Peter Schiff dissects Yellen’s press conference and the Fed’s statement to explain why the Fed will never raise interest rates. In fact, Peter thinks the United States is overdue for another cyclical recession. Physical gold and silver investors should be focusing on this big picture view instead of the deliberately confusing hypotheticals presented by Yellen and the financial media. The economy is getting worse, and this latest news is just another opportunity to stock up on more gold at discounted prices before the markets wake up to the reality of the Fed’s predicament. Here are some excerpts from the video, which you can watch below.
A recent article on the Wall Street Journal’s blog draws attention to the high cost of producing a single penny – 1.6 cents each, to be exact. They blame this unsustainable price on the high cost of zinc, which makes up 97.5% of every American penny. The online publication Quartz ran with this story, giving it a new headline: “It costs 1.6 cents to make one penny because of the rising price of zinc”. Time for a short economics lesson.
An alternate, more accurate headline for this story would be, “It cost 1.6 cents to make a penny because of currency debasement.” Rather than pondering whether or not the United States should simply stop producing pennies to save money, Americans should really be thinking about the long-term effects of currency debasement that has been going on for generations.
Let’s be honest. No one has the time or patience to actually watch Janet Yellen’s press conferences about the Federal Open Market Committee’s meetings. Besides, the news never seems to change – the US economy is never quite good enough for the Committee to recommend that interest rates actually be raised back to “normal” levels. Even if Yellen did have something interesting to say, her delivery is about as captivating as a pet rock. At most, you might be able to sit through, say… four minutes. Thank goodness Grabien has created a video mash-up of every Janet Yellen press conference ever to fit exactly that time frame. So next time Yellen has something to say about the FOMC, skip it. You can watch this instead.
If you’re seriously wondering when the Fed will actually raise interest rates, read Peter Schiff’s latest commentary explaining what the Fed’s “new normal” is. Find it here.
Follow us on Twitter to stay up-to-date on Peter Schiff’s latest thoughts: @SchiffGold
Interested in learning about the best ways to buy gold and silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!
Once again, the financial world watched the Federal Reserve this week in the hopes of hearing some real news about whether or not interest rates would be raised in the near future. While the Fed continued to taper its quantitative easing, it said that interest rates would remain at zero for a “considerable time.” To economists like Peter Schiff this is more or less an open admission that the United States economy is in terrible condition. If the economy was improving, why would it need the continued intervention from the central bank?
In his latest written commentary, Peter compares historical Fed policies to the central banks’ actions in the past eight years. He explains clearly and succinctly why we’re in a new age of “forward guidance” and how disastrous it will be for the economy. Don’t look for interest rates to be raised at all, Peter argues. Instead, another dose of QE is probably right around the corner.
Are Government Bonds Really ‘Safe’?
By Dickson Buchanan Jr., Director of International Development
One of the striking ironies of our modern economy is that government bonds are considered safe-haven investments, while gold is a “barbarous relic” to be avoided at all costs. Since the 2008 financial collapse, the bond market has been on a tear, thanks to the Federal Reserve’s endless interest rate suppression. This has only served to reinforce the traditional notion that government bonds are “safe.”
Meanwhile, the financial media argues that gold is no longer relevant to today’s investors. They conveniently ignore the fact that gold has been a safe-haven for thousands of years, while government paper has only been around for a handful of decades.
However, government bonds fall short of traditional investment goals. A look at the history of government-issued bonds in the 20th century reveals terrible performance. Applying this historical knowledge to our current economic climate, and bonds don’t stand a chance when compared to time-tested gold bullion.
Listening to the financial media, you might be convinced that the precious metals – gold in particular – are simply not considered reliable investments anymore. This is a viewpoint peculiar to the West, as Peter Schiff has repeatedly emphasized. However, every now and then, the mainstream media shares some news reminding us that while Americans and Europeans might be disenchanted with the yellow metal, other countries are still very concerned with protecting their savings with the hard asset that has served as a safe-haven for thousands of years. Often that news comes from countries that have a much longer history of troubled economies, and therefore a greater understanding of what assets carry real value in this world.
Today, for instance, Bloomberg published two stories about central bank and Chinese gold demand. In the first, “China May Boost Gold Reserves Amid Imbalances in Holdings“, Bloomberg reports on research from the London-based Official Monetary and Financial Institutions Forum. David Marsh, managing director of the Forum, reminds us that while China hasn’t officially announced an increase in its gold reserves since 2009, there is a good chance that it will very soon. Marsh vaguely suggests that China has been adding to its reserves since 2009 “in different ways.”
Peter Schiff was interviewed by Paul Vigna on Wall Street Journal Video yesterday. Peter explained to Vigna the terrible effects that the Federal Reserve’s zero interest-rate policy is having on the United States economy. They spoke about how tepid the American job market is right now, and why Peter thinks a new round of quantitative easing is right around the corner. If you’d like to read Peter’s latest written commentary about why central banks are wrong to think that inflation is the cure for our economic woes, you can find it here.
The next thing the Fed is going to do is launch an even bigger round of QE than the one they’re tapering off from. Because the US economy is not recovering. We are slipping back into recession. If the Fed doesn’t know that yet, it will by the end of the year… Tightening is all talk… [The Fed will eventually start] a new round of QE that will make the Europeans and Japanese blush.”
Follow us on Twitter to stay up-to-date on Peter Schiff’s latest thoughts: @SchiffGold
Interested in learning about the best ways to buy gold and silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!
Peter Schiff answers some of the more challenging questions he has received from you, his loyal subscribers. Learn what he really thinks about gold manipulation, why Wall Street hates gold, who should buy silver instead of gold, and more!
In the 80s, America confronted two great risks – an evil empire and an out-of-control US dollar. Unfortunately, though we beat the communists, we seem to be losing the battle for sound money.
For its latest comic, Lampoon the System reprises War Games, the classic 1983 blockbuster starring Matthew Broderick. The esteemed Jim Rickards plays the role of “Joshua”, the supercomputer in the movie. Peter Schiff interviewed Rickards in August, and they talked extensively about the repercussions of an international “currency war.” If you missed it, check it out here.
Jon Pawelko publishes the web comic Lampoon The System to poke fun at insane economic policies and educate the public on sound economics.
Click here for more cartoons and information on his anthology book, available for only $15.
Follow us on Twitter to stay up-to-date on Peter Schiff’s latest thoughts: @SchiffGold
Interested in learning about the best ways to buy gold and silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!
