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Will Peter Schiff Be Right Again?

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Will Peter Schiff Be Right Again?

Postby bossfan » April 4th, 2012, 5:06 am

"What do you do when one of the very few economic analysts to predict the financial crisis would strike in ’07 or ’08 says another, even more catastrophic economic collapse will hit the United States economy in 2013 or 2014?"


The Worst Is Yet To Come: Peter Schiff's Economic Forecast

What Peter Schiff sees as the problem and its solution:

Schiff has a view on what the problem is, “We consume more than we produce and we borrow abroad, but we are never going to be able to pay them back.” Not only that, but Schiff says when the economic crisis hits, your money might not be safe. While most major banks have passed the Federal Reserve’s strenuous stress tests to ensure their viability in the event of another economic catastrophe, Schiff says those tests are predicated on another massive decline in home equity and real estate prices, which was the last bubble to pop, not the next one: “The Fed didn’t ask the banks to stress test a big drop in the bond market because that’s what coming, and the banks would fail that.”

His solution? “The more you delay it, the bigger it will be, so we need to raise interest rates during the recession to confront the inefficiencies.” It’s not just unconventional, it’s the exact opposite of what most analysts on both sides of the partisan divide would recommend and flies in the face of the Federal Reserve’s management of the crisis by frantically holding interest rates down to what is functionally a zero percent rate. Schiff argues the easy money policies and the debt-based economy is what caused the problem in the first place and more of the same will only make it worse. Instead, Schiff believes a recession is a necessary transition of the economy from a debt and consumption-based economy to a production-based economy that creates real wealth and real jobs. He even suggests that the bad medicine doesn’t have to be all bad: “In a deflation[ary recession], real wages will rise because the cost of goods will fall faster.”
"Democracy allows for A and B to band together to rip off C. This is not justice, but a moral outrage."
~ Hans-Hermann Hoppe
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Re: Will Peter Schiff Be Right Again?

Postby davehines » April 4th, 2012, 6:41 am

Schiff is right, and the longer the bozos in DC kick the can down the road the worse it will be.
“Good order results spontaneously when things are let alone."
-- F. A. Hayek
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Re: Will Peter Schiff Be Right Again?

Postby davehines » April 16th, 2012, 5:15 am

“Good order results spontaneously when things are let alone."
-- F. A. Hayek
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