After the August CPI report showed price inflation heating up again thanks to rising gasoline prices, Peter Schiff appeared with Jesse Kelly on First TV to answer the question: where are we heading? Peter said this story is going to have a tragic ending.
In the last few days, gold and silver have paused their earlier rises. In the case of silver, these have been substantial, as shown in our headline chart. In gold, less so; but it does appear that silver is leading both metals higher. In European trade Friday morning, gold was $1944, up $39 on the week, and silver $24.60, up 40 cents. Silver is up 10% from its mid-August low, leading gold which is up only 3%.
The financial crisis precipitated by rising interest rates continues to bubble under the surface.
Earlier this month, Moody’s cut the credit rating of 10 small and midsize banks. It also placed six large banks on review for potential downgrades and revised 11 more banks from a stable outlook to a negative outlook.
This week, S&P Global followed Moody’s lead and downgraded the credit ratings of five banks. It also lowered the outlook for several others
In another sign the financial crisis continues to bubble under the surface, banks borrowed an additional $3.7 billion from the Federal Reserve’s bank bailout program in July.
Currently, there are $106.9 billion in outstanding loans in the Bank Term Funding Program (BTFP).
After the Federal Reserve incentivized borrowing with more than a decade of artificially low interest rates and easy money, the debt chickens are coming home to roost.
Last week, Fitch Ratings downgraded the US’s long-term credit rating from AAA to AA+, and on Monday, Moody’s cut the credit rating of 10 small and midsize banks.
Janet Yellen recently said she doesn’t think the US economy will slip into a recession. Friday Gold Wrap host Mike Maharrey explains why he doesn’t think we should put a lot of stock on Janet’s prognostications, and he goes on to point out some major fissures in the economy and financial system that are opening up under the surface.
Four months after the failure of Silicon Valley Bank and Signature Bank, the financial crisis sparked by Federal Reserve rate hikes continues to simmer under the surface.
As of the end of the first quarter, Bank of America had over $100 billion in unrealized losses on its bond portfolio. This is the exact problem that torpedoed Silicon Valley Bank (SVB).
In March, I warned that the commercial and investment real estate markets could be the next thing to break in this bubble economy. A recent article in the Wall Street Journal put a face on my warning.
We saw a big selloff in the gold market last week and the price dropped below $2,000 an ounce. The catalyst for that selloff was tough talk from several Federal Reserve officials and an increasing expectation that the central bank will raise rates again in June. As Peter Schiff explained in his podcast, everybody thinks the Fed is going to win the inflation fight because it is going to be even tougher. In reality, they are talking tougher because they are losing the fight.
Peter Schiff appeared on First TV’s I’m Right with Jesse Kelly to talk about the state of the economy, inflation, and the unfolding financial crisis. Peter warned that we’re heading straight toward Great Depression 2.0.
