A lot of seemingly positive economic data came out last week, but in his most recent podcast, Peter Schiff said it is just feeding into a delusional economic narrative that ignores the most fundamental storyline – debt. Everybody is talking about a new era of prosperity, but Peter said it’s a phony prosperity and it isn’t going to last.
Up until 1964, silver was literally money in the United States. Dimes, quarters and half-dollars were made from 90% silver. Looking at the value of these silver coins today reveals just how much the US government and Federal Reserve have devalued American money.
Gold tends to get more attention than silver, but the white metal still shines and some analysts believe it is poised to out-perform its big brother. Based on the historical silver/gold ratio, silver is currently significantly undervalued compared to gold.
So, could silver outshine gold in the wake of the next economic crisis? Analyst Dan Kurz thinks it might, and he builds the case in his latest in-dept analysis at DK Analytics.
Americans have loaded themselves down with debt and some are struggling to pay the bill.
Total household debt hit a record $13 trillion in 2017, eclipsing levels seen on the eve of the Great Recession. Americans have been burning up the credit cards. Revolving debt grew by $26 billion in the fourth quarter of 2017 alone, a 3.2% increase. Americans have run up a nearly $1 trillion credit card tab. Meanwhile, flows into serious delinquency have increased steadily since the third quarter of 2016.
The delinquency level for subprime credit cards is particularly concerning, having risen to a level higher than at the peak of the financial crisis.
Your great grandchildren are broke.
They may not even be born yet, but they are still broke.
The government has spent us, our children, our grandchildren and even our great-grandchildren into a black hole of debt. The world is drowning in debt. At some point, somebody will have to pay for it – one way or another.
On May 15, Peter Schiff delivered the keynote address at the Cambridge House International Mining Investment Conference. Peter titled his speech “The Calm Before the Storm.” People are still generally optimistic about the economy, but as Peter said, everything feels great until you realize the party is over.
On Tuesday, the Dow Jones dropped nearly 200 points. Gold fell close to 2% and fell below the $1,300 mark. Meanwhile, bond prices dropped as yields on the 10-year pushed above the 3% level.
In his most recent podcast, Peter Schiff said we’re witnessing a bond breakdown as it gathers momentum.
In fact, the bond market had one of its worst days all year Tuesday.
As we reported earlier this month, the federal government is borrowing money at record levels. The US Treasury’s net borrowing totaled $488 billion from January through March, adding to an already enormous national debt. In fact, the entire world is drowning in debt.
When we bring this fact up, a lot of people still just shrug and say, “So what? We’ve been running up debt for years. It hasn’t really caused any problems. Why worry about it now?”
David Stockman recently appeared on the Tom Woods Show. During the interview, the former Officer of Budget and Management director under Ronald Reagan explained exactly why we should worry about it now.
The US dollar has rallied over the last few weeks. The dollar index closed above 93 on May 8. This represents about a 5% increase from the low this year of just above 88. On the year, the dollar is up about 1%, although it is still off about 6% from its highs in 2016.
In his latest podcast, Peter Schiff called this a “bear market rally.”
There hasn’t been any good economic news that would explain the strength of the dollar.”