During a podcast last month, Peter Schiff asked a key question: who is going to buy all of the debt necessary to finance the ballooning US deficit?
In his most recent analysis, Dan Kurtz at DK Analytics explores this question more in-depth and comes to generally the same conclusion.
The dollar has lost more than 8% of its value over the last year. That decline may accelerate as bond investors sell ahead of a huge expansion in Treasuries coming into the market. Interest rates will have to climb significantly. The price of bonds will drop. As Dan put it, where bonds go, stocks follow.
We’ve excerpted some key points from Dan’s report.
Remember the golden rule: He who has the gold makes the rules.”
And the Russians have the gold. Or at least they are in the process of getting it.
Peter Schiff recently attended the Vancouver Resource Investment Conference. While he was there, he did an interview with Daniela Cambone of Kitco News.
Peter and Cambone talked gold, and Peter said he thinks the yellow metal is set to soar, despite the sentiment that Federal Reserve Rate hikes will hold gold down.
Gold has not really rallied. It’s been going up, right? But it’s been creeping higher. Now, everybody expected it to fall. Everybody believed that as soon as the Fed hiked rates, gold’s gonna tank. And it didn’t tank. It rallied.”
Everybody seems bullish on the economy. Nobody is worried about anything, even though there is everything to be worried about. Peter Schiff said he feels like he’s in Alice in Wonderland. In his most recent podcast, he referenced a Morgan Stanley analyst interviewed by CNBC.
She’s unquestioningly bullish on every front. Everything is bullish. There is nothing at all to worry about. In fact, the only thing she said that anybody is worried about is that there’s nothing to worry about. It’s that things are so good, they’re wondering what are we missing. Maybe we should be a little bit worried because nobody is worried because everything is good. I mean, there are so many things to worry about. That is the reality. But they’re not worried about any of them.”
The dollar continued to tank Wednesday, hitting a 3-year low after Treasury Secretary Steven Mnuchin said he welcomed a weakening dollar.
The dollar index measuring the greenback against a basket of six major currencies slipped below 90 for the first time since December 2014. Meanwhile, gold climbed, hitting its highest level since August 2016.
Last Friday, all three major stock markets hit new record highs ignoring the storm clouds on the horizon. In his latest podcast, Peter Schiff said this reminds him of 1987.
The stock market is rising despite the fact that there are very, very negative factors that are building, that are hiding in plain sight, that everybody is ignoring.”
When it comes to the economy, most people aren’t worried about anything when there is everything to worry about.
The stock market has continued its upward trajectory through the first two weeks of the new year. In fact, the market has only seen one down day since Jan. 1. Peter Schiff appeared on The Street and opened things up with a bang, calling investors “Oblivious.”
Peter reiterated a message he’s been preaching on his own podcast for weeks – despite what you see in the markets, the US economy is heading for a major crash. We’re partying like it’s 2006 – oblivious to what’s lurking right around the corner.
Peter also talked about China’s decision to cut back or end the purchase of US Treasuries, the Federal Reserve, Trump’s economy and Bitcoin during the interview.
When the housing bubble popped in 2007, the Federal Reserve went to work to reinflate the bubble. It quickly pushed interest rates to zero, and in December 2008, the Fed launched the first of three rounds of quantitative easing. The virtual money printing lasted for five years.
So, what did we ultimately get for the billions of dollars created by these Federal Reserve programs? As Ron Paul explains in a special episode of the Liberty Report, more numerous and bigger bubbles, and another crisis waiting to happen.