We saw a big rotation into risk assets after last week’s Federal Reserve meeting. Then we had another big shock to the markets when the non-farm payroll report came out much stronger than expected. In his podcast, Peter Schiff broke down the market reaction to last week’s events and reveals that while risk was on, economic understanding was off.
Do you believe your eyes? Or do you believe your ears? That’s the dilemma you face as you try to make sense of the latest Federal Reserve meeting and Jerome Powell’s messaging. It’s also a question to ask yourself if you’re evaluating the performance of gold over the last year. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey explores this dilemma in both contexts.
Is the Federal Reserve easing off the accelerator on its inflation fight?
The answer depends on whether you believe your eyes or your ears.
The US economy runs on money printing and artificially low interest rates. Nowhere is that more obvious than in the housing market.
With aggressive rate hikes in its war against price inflation, the Federal Reserve pricked the housing bubble and air continues to seep out. Existing home sales fall for the 11th straight month in December — the longest streak of declines in history.
Rising consumer debts colliding with rising interest rates is a ticking time bomb.
Over the last several months, consumer debt has climbed at a steep, steady pace as Americans struggle with rising prices. November was no different, with consumers piling on another $27.9 billion in debt.
Jerome Powell still insists the Federal Reserve can beat inflation while bringing the economy to a “soft landing.” But there are underlying issues in the economy that make it extraordinarily doubtful that the economy can avoid a major downturn – despite Powell’s claims to the contrary.
One of the biggest problems facing the Fed is the amount of debt in the global economy.
For the last several years, we’ve enjoyed the fruits of an economic bubble blown up by easy money and debt. But ultimately, that debt is going to be the economy’s undoing. Simply put, these debt levels are unsustainable without runaway inflation.
So, pick your poison.
Just before Christmas, Congress passed a massive omnibus spending bill. This is yet another blow to the Federal Reserve’s feckless fight against inflation.
The US housing bubble continues to lose air at a rapid rate. Existing home sales fell for the 10th straight month in November. This stretch of declining home sales is longer than the housing bust preceding the 2008 financial crisis.
Peter Schiff joined Liz Claman and Andrew Brenner of NatAlliance Securities to talk about the December Federal Reserve meeting and the messaging from Fed Chair Jerome Powell. Peter said investors need to understand that the game has changed. Inflation isn’t going away.
