Financial analyst Peter Schiff says there’s a big problem with the economy even though the mainstream media is reporting that rising interest rates are a good thing. The problem, however, is that Americans are broke, and those interest rates could have a major impact on some of our wallets.
“The bad news is, we are going to live through another Great Depression and it’s going to be very different. This will be in many ways, much much worse, than what people had to endure during the Great Depression,” Schiff says. “This is going to be a dollar crisis.”
“When you are talking about the magnitude of the debt we have, that extra money [raising interest rates] is big. That’s going to be a big drain on the economy to the extent that we have to pay higher interest to international creditors…a lot of this phony GDP is coming from consumption, while the average American who is consuming is deeply in debt and they are going to impacted dramatically in the increase in the cost of servicing that debt…given how much debt we have, and how much debt is going to be marketed the massive increase in supply will argue for interest rates that are higher.” –Peter Schiff
Retail sales “unexpectedly” fell again in February even though most media outlets are touting a booming economy that can support raising the interest rates. It was the third straight monthly drop and the first time the US economy has seen three straight months of declining retail sales since 2012.
Sales fell 0.1% in February even though analysts had expected an uptick of 0.3%. According to CNBC, households cut back on purchases of motor vehicles and other big-ticket items, pointing to a slowdown in economic growth in the first quarter. But Peter Schiff won’t sugarcoat this one for us: Americans are broke.
And the worse things get, the less investors seem to notice.
What makes matters even worse is on Friday, we got the “too good to be true” and “just what the doctor ordered” Goldilocks jobs report that said 1 million people got jobs. Schiff said this “good news” report doesn’t make any sense, actually.
“So why didn’t any of those million people take their paychecks and spend them at a retailer? I mean, Trump is talking about all the great jobs, and all the raises that people have, and all the tax cuts. Why are retail sales down for three months in a row?” –Peter Schiff
Unfortunately, we also saw Americans running up record high levels of debt at the same time that the government is running massive deficits.
Last month, the New York Fed released the latest data on US household debt, revealing it has grown to a record $13 trillion. So yes, Americans have been spending, but they’ve been putting a lot of it on plastic. Credit card balances grew by $24 billion in the last quarter of 2017 alone. Could it be that Americans have maxed out the plastic?
At some point, a house of credit cards will collapse.
Schiff is hard on Donald Trump too, and rightfully so. Lower taxes are always a good thing, the lower the better, in fact. But Republicans refused to cut any government spending while instead, increasing it to the point of running massive deficits, making them worse than Democrats when it comes to being fiscally conservative.
The cold truth is that a back plan is needed, and most Americans don’t have that. Many would be in some serious trouble during a financial downturn, and the country is most definitely headed that way.
So we shouldn’t raise interest rates and just let the pensions and insurance Cos go broke? That works. Quit bitching and tell me what “CAN” be done or just report it and cut the comments. IMHO we are so broke the best thing would be to just buy anything we can: GOLD, Oil, Silver, Rare Earths; whatever and stockpile the stuff. When we go down the more we owe the better. And I’d say it’s politically impossible to make the cuts we need, so we might as well pay with blips and keep getting all we can.
For example, I hate buying China stuff but I’m converting to long life light bulbs. All of which are made there, but as some of them have 50,000 hour life (50 years) they will outlast me and all the rest of this.
I have the same bulbs. They say how they last 10-years. Total bullsh*t. I have already started replacing them after only as little as 2-years. Not even that.
What a racket. The old incandescent bulbs cost less than a buck and last longer than these LED bulbs. What a racket. The professional politicians outlaw perfectly good light bulbs so you have to buy crap LED bulbs costing 10-times as much.
Pure horse sh*t. Tell me the system isn’t crooked to the core.
First there was Japan Crap. Then there as Asia Crap. Now there is China Crap. China Crap is the worst ever.
I’m not paying $6+ for a lightbulb, the old style are still sold at dollar tree for 2-3 costing a dollar. The phase out of cheap perfectly good lightbulbs for a much more profitable bulb. I know some aspect of the older bulbs was said to be bad, blah blah blah. With all of the latest technology and streamlining of manufacturing methods where is the better and cheaper product?
The new LED bulbs depend on a reliable energy source. The current (pardon the pun) infrastructure, “the grid,” here in the US is pure third world. I bet the crap they are calling electricity is comprising all these high tech (so called) of these LED bulbs.
My father lives out in the rurals. The power system of his computer has been burned up, twice. He had the electric company come out and measure his line. He was getting crap for power. Surges. Sags. Spikes. This high technology (so-called), can’t handle it. He bought a power regulator (a big brick like thing that organizes the incoming power from the line before it is fed into the computer).
The U.S. power grid is in such poor condition because any major improvement is obstructed by environmental wackos and other assorted NIMBYs. Of course our power grid is old. We invented the thing.
The grid is weak because of the deregulation of the 1970s (PURPA). The regulated monopolies had deep pockets to spend on continuous upgrades. Allowing IPPs (Independent power producers) to cut in on generation cost them significantly. We have ran on the fat in the grid that has now ended.
Led bulbs are unhealthy. Google Dr. Mercola.
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You conveniently forgot the “American Crap.”
In an incandescent lamp, about 5% of the power consumed is converted to visible light. They are better heaters than lights.
i agree, blame, i have seen them last MUCH less than 6 months….”made in china” IS a warning label, afterall…..
What to say about this? I’m just a truck driver but I have a family full of accountants and 1 financial consultant. One of my sons mama is a financial analyst. Maybe it’s in my blood to take good care of my finances. I think I’m an average guy, but I’m far from broke. A mortgage, 2 car payments and credit card “debt” that gets paid off every month. I have a good job and I work very hard but my oldest son, who is 1 of those accountants I mentioned, makes more money than me. I think most people who are “broke” are actually deeply in debt. And it’s more than likely from bad choices. A lot of folks get some money in their hand and just gotta spend it, and then spend more than they should and they end up in deep debt. I honestly don’t have sympathy for these people. Our government is no better. None of us really know everything da gubmint spends all our money on. I’m betting at least 60% of it is unnecessary waste. If we want our fiscal house in order, tax cuts AND spending cuts must be realized. If not, then we will never break from this economic muck that this country is trapped in and at some point, it will collapse. It’s that simple. I wish our constitution were expanded to cover economic policies wherein our government cannot tax its citizens more than say10% of their income, and what specifically those revenues are used for. They also need to engage this welfare fraud problem we have as well as a ton of other stuff.
Be careful with LED light bulbs. The 60K-100K hour life is BS. The LEDs may last a long time, but the electronics that run the thing are often junk.
Stocked several med. sz bins with Edison GE Reveal bulbs in 40 and 60 watts, then a third bin with spiral shaped fluorescent in 75 and 100’s or 26 w. bulbs, so should last until I’m well over 120 yrs old.
laura ann ~ I agree that the spiral CF lamps are good – I bought some in the early 1990s and some of them are still working fine. They aren’t as efficient as LEDs but they still are much more efficient than incandescent lights.
The only drawback is that CF lights contain mercury and need special disposal to keep it out of landfills.
One overriding argument for stockpiling a bunch of the old, terribly inefficient incandescent light bulbs is that a EMP will fry the electronics in LEDs and CF lights. An incandescent light bulb is just a wire in a bottle and will not be affected by an EMP.
A quick history of the ’87 Crash and a short lesson in arbitrage. 🙂
https://www.youtube.com/watch?v=KFa4-SRIhIM
Not me We haven’t any debt. and our Social Security Ponzi check’s was deposited at midnite Wednesday AM. So we are good for another month.
Not me either….
But don’t worry, Schiff will be right one day. I’m certain of it…. but you might not live that long.
Stuart: Schiff may not live that long either when a depression hits. I have heard the same thing since early ’80’s so if it was going to happen it would have already, since it’s planned. It wouldn’t drag on this long. X- preppers of y2k think prepping is a money racket. Preparing for bad weather is common sense.
I’m buying a house come what may. The hell with all the naysayers around here and everywhere. A place to raise my chickens,grow a garden,and do what I feel like. A rural place where I’m not part to anyone elses drama.
You own nothing.
Property taxes have become a nightmare. If you own a place appraised for $500,000 in some state like California, or New York, you are automatically in the highest tax bracket. Your property taxes alone are going to come to $20,000 grand a year.
This is horse sh*t. The system needs to be reset.
I live in Arizona where one can still find a good deal in the rural parts. Places out here costing $500,000 are located in places like Phoenix and parts of Tucson.Places like that are going down hill anyway with the libs in charge.
Blame-e:
You exaggerate. Taxes on a $500,000.00 house are closer to $2,000.00 a year, not $20,000.00. Which is still too much.
But everything else you said I agree with.
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In MI property taxes on a 100k house are $2400 annually.
Was just watching a property show on DIY i think, was NY, taxes on a 700,000+ house were 22,000$ a year, other area also NY was 13,000 a year, friends house in Ca is 24,000$ a year in bay area
Wait how does California have cheaper taxes than rural GA my place is valued at 150,000 and im at 1700 a year… and its going up heavy for the last 3 yrs
In southern OH, I pay $2700 in property tax for a house worth less than $200K.
New Yorkers and New Jerseyans commonly pay $12,000 to $24,000 a year in property taxes on single family houses. I own a one bedroom apartment and paid $3,000 in property tax last year.
Exaggerate? Me? BS. You just haven’t been paying attention. You owe me an apology.
Our family has a place on one of the Finger Lakes in Upstate New York. Been there since 1966. Taxes are now damn near equal to what we paid for the place in 1966 — per year. Fact. Almost every 2-years we have bought another place on the lake. Fact.
This is why most children of successful professionals end up having to sell the home they grew up in. The rent (taxes) is just “too damn high.”
Here is a really interesting fact.
2016
Taxes: $19,218 | Land: $38,400 + Property: $513,600 =
Appraised Value: $552,000
And this is for an abandoned Atlas F Missile Silo out in the middle of no where in the Adirondacks.
http://www.realtor.com/realestateandhomes-detail/87-Hale-Hill-Ln_Lewis_NY_12950_M33770-05635
If you had money to burn why not? The one problem is is in NY. Move it east 50 or so miles into Vermont an you might want to visit it on occasion.
IT DEPENDS ON WHAT STATE YOU LIVE IN !!!!
Been years, but if I remember correctly New Hampshire has the highest rate – because they have NO STATE SALES TAX. So, property taxes pay for everything, and you’ll pay $5,000 per year on a $200,000 property.
City of Nashville, TN is having budget problems.
The city raised property taxes and people are more than a little upset.
So the people have contested their new property taxes and so many have gotten them lowered that it has affected the city’s budget (short fall).
We are born free, taxed to death.
No, he isn’t off the mark –many states have high taxes like those mentioned.
I saw a sample of taxes per state and many state’s property taxes per month were equal to my taxes here in Ky. for a year!!!
Not sure what world you live in. The taxes on my 200k home in Pennsylvania are around 2500 per year, and we have the lowest taxes in the area and likely one of the lowest in the US. Kalifornification on the other hand has to be the worst.
Yep, this is one of the “American crap” you conveniently left off.
If you live in NYC or the immediate surrounding area, you might be paying that much.
Go UpState and you can buy a good chunk of land for cheap and not pay much in property taxes.
In 2011 they passed a cap on property taxes at 2% per year. They are looking to make it permanent. I just answered a survey from my local State legislature concerning this.
But you are right, the whole thing needs a reset.
In Arizona property taxes typically run ten grand per million, or less. In Arizona you can buy a house (or other property) and lease it to your CHURCH in which to hold services for a bona fide organization, and be property tax exempt.
That’s why you see so many little Baptist churches in rural Arizona. The Tucson market like ALL others in the mountain West is still experiencing a market decline. It’s a buyer’s market everywhere: Palm Springs, Phoenix, Scottsdale, Sedona, TMCG East Valley; Provo, Park City, LV, you name it. A great time to buy if you are savvy negotiator.
In Tucson I recommend Marana and west Tucson where you can still find a few acres of raw land at very reasonable prices. Also Rio Rico, Tubac, and Benson. That said you must still drill a well and install a septic system.
Any well pumping less than 35 gallons of water per minute for domestic use is exempt from oversight. I am currently looking at land in Yavapai County in Prescott and/or Sedona. Sedona as you might imagine is quite expensive, but the vortexes will keep your chakras clear if you can avoid the sinkholes. 🙂
I live in a very poor rural county in Tx. I’m a truck driver/operator(heavy equipment). Wages are at an all time low. In 1980 average truck driver pay was $39+K a year, translates into $115,000 now.
I’ve been an owner/operator back when you could make a living until the fake oil embargo in the early 70’s that doubled fuel prices and sent 75% of O/O into the poorhouse in ’75 and then the same percentage in ’76 at which I got out.
RR deregulated trucking so every 6 months big fleets were sold to some large corporation so names changed and tax write-offs were commonplace.
Now I truck with people who don’t speaka da Englis and don’t even try. One guy, an enterprising type, had a cell phone you could speak into and it translated to him and then he’d speak and it would translate to you. I see some of the most scabbed up crap you can imagine and most of these guys work for nearly nothing if you can keep them on the back roads out of sight and out of mind of the DOT. Just yesterday I flashed my lights to one to give him the ROW to enter a site. We were both about the same distance and I didn’t want to have some accident, better to let him go. After he’d sat there a while, I just said “F it” and started off in 3rd to haul ass and get out of the mix…..and after I did, he did too. Maybe flashing lights means playing chicken in Mexico.
Sorry I’m not up to living 20 people to a house but I feel I’m definitely on a learning curve.
Once the feds come for everyone’s guns I won’t need to worry. It’s the old cold dead hand thing and I’m still a hell of a shot at 68 and know my way around to stay hidden. I don’t see a “nice” retirement but it will be “eventful”. Sorry my faithful pooch and kitties, maybe the neighbor will take you in…..if he survives.
Oh God, not Peter Schiff, again. I like Peter. I really do. It’s not like Peter is wrong. That would be too easy. It’s that Peter can be so sure about it, and still not get it right.
“It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so.” – Mark Twain
Of course the American people are broke. But that is not what is going on here. People being dead broke is not going to break the bank, so to speak. That doesn’t work anymore.
The game has become so fully-rigged, manipulated, and controlled by the likes of the Deep State, professional politicians, Banksters, the FED, and MSM; and these fool idiots are completely confident in their absolute powers over everything.
They are in control of nothing. Wait until this sucker wakes up and goes south.
The thing Peter hasn’t thought about is that he’s a guy with virtually no real-world skills. He and is ilk are going to be destroyed. Were I him, I’d shut up and use what money I had to get out of the Wall Street ‘Dodge’ asap. But he’s too addicted to his own sense of being a legend in his own mind. Loves the publicity. Okay, Petey, we see ya, know your face…. and hey guy, Lauren’s kinda purdy… need a can of beans?
The only interest rate that needs to be raised is what the banks pay on savings accounts. What’s worse is that they tax it. It’s disgraceful!
We know the game is rigged. It isn’t fair. The most qualified doesn’t get the job or the promotion. There is institutional racism against white males under the guise of civil rights, multi-culturalism, and affirmative Action.
It’s a winding stairway heading to the basement. The bankers and their cronies have the loot and they’re holding on to it.
If you make more it is taken away by higher taxes.
It sucks.
My strategy is to stay positive. Forget the obstacles or mow right through them.
I acknowledge the above, then head on with my plans. There isn’t anything I can’t do. I’m not super rich but I’m doing alright.
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“So why didn’t any of those million people take their paychecks and spend them at a retailer? I mean, Trump is talking about all the great jobs, and all the raises that people have, and all the tax cuts. Why are retail sales down for three months in a row?” –Peter Schiff
Because, maybe the Americans not on welfare paid by YOUR taxes are awake…..and saving that bonus.
And, I still have bulbs bought years ago. I also see the 100 watt are still on shelves for sale–not forbidden as the story went.
I always live below my means. No loans. No credit cards. Cash for 99% of my personal transactions. Saving up for an old truck right now. Will start looking for one in June. Cash from a private owner only. No financing. I have my reasons for staying debt-free and don’t apologize for it.
The Deplorable Braveheart
If every American operated the same way a significant amount of unearned political power would be taken rom the banksters and put back into the hands of “We The People”. I applaud you sir.
Kevin2, coming from you I gladly accept the compliment. Thank you for that. I just refuse to be like the ‘sheeple’ and go into debt to pay for a bunch of useless junk. My prepping has always been my top priority. People like us have our priorities straight. Sheeple don’t and will one day pay dearly for that.
Here’s a detail I learned just today from my tax preparer.
You know that tax reduction (from the recently passed tax law) so there is more in the take-home pay? Well, that will be falling apart slowly over a few years. Enjoy it while you have it.
Another detail: be sure that enough dollars are taken out. Because the withholding rules have also changed, it might end up where you have to pay at tax time. My tax preparer said many more people will fall into this inadvertently so please check with your tax preparer/accountant that enough is withheld to avoid a big tax bill in the future.
Yeah, they really fixed the tax laws…..
I have not gotten a Federal tax refund in close to 30 years. I always have to pay, and lately, I usually owe a penalty. I have never received a bill for that penalty( penalty is usually less than $50).
If America payed taxes like I do, we might get the ba$tards to cut some of the waste out. What would they do if 60 million people did not send in their taxes on April 15th?
https://www.youtube.com/watch?v=scC5-W4raBs
People are getting so so jobs,not high paying. everytime the FED raises rates the cost of everything goes up. You don’t think the banks are going to absorb those rates do you? The government will have to pay more of our taxes and the money they borrow to pay the interest on those loans. Never ending!
Living paycheck to paycheck for over 20years, and now they say that we are broke. I was broke 20 years ago. Duhhhh. They’re little slow. Just more propaganda and B.S. The real news will be China and Russia attacking our west coast very soon.
The unemployed rate could be over 60% and still a rosy picture of the economy would be painted from government and msm mouthpieces. This game can end as abruptly as a game of monopoly. One got it all and the rest are bankrupt.
I’ve talked to some mom and pop business owners the last few months. Things are SLOW.
I own a couple of bars in SC and I can tell you people aren’t drinking the way they use to. When they stop drinking that’s a sure fire way to tell they’re broke!
Here’s an interesting tidbit that keeps popping up on this site.
“Your comment is awaiting moderation and should appear within 0 to 2 hours. Your comment has been moderated because our system does not recognize your IP address or email address. If you utilize an email address (even a fake one) when submitting your comment in the future our spam filtering system will eventually recognize you as a trusted user and automatically approve future comments.”
My IP address is a problem? BS. I post here all the time. You all know that. “Spam filtering?” Code for censorship. This site must “automatically approve” comments? That’s great. When the DHS shows up at my door looking to charge me with acts of free speech, and free expression, under the guise of “domestic acts of terrorism” I’ll just say: “BUT SHTF SAID IT WAS OKAY!”
We use to just censor words.
Now, with political correctness on the loose, even on the supposedly alternative news sites like SHFT, we censor ideas.
https://www.bing.com/videos/search?q=george+carlin+7+deadly+words&view=detail&mid=8E123F6E7AFE30D1CB728E123F6E7AFE30D1CB72&FORM=VIRE
We do not censor. We have to manually approve every comment and we don’t do that 24/7.
Well, if you don’t censor, then WHY must you manually approve each post? To look for those you don’t approve of? Then what DO you do when you find the post you don’t approve of? Publish it anyway? You’re illogical.
It’s how WordPress platforms work.
The only kinds of comments we don’t approve are spam.
From the commenting policy:
“Some comments on this web site are automatically moderated through our Spam protection systems. Please be patient if your comment isn’t immediately available. We’re not trying to censor you, the system just wants to make sure you’re not a robot posting random spam.”
What really pisses me off is when someone lectures us about how Americans don’t save enough or contribute more to charity! The phrase “the richest nation on earth”;how are they defining this? The rest of the world must really be deep in sh*t!
I really believe things are cyclical. We are getting close to retirement and want to live at a lesser expensive gated community we know about because my in-laws used to live there. My in-laws sold their house down south six years ago at the BOTTOM. They didn’t have to move. My MIL got emotional and wanted to move back home because all their friends had died down there for the most part. Now six years later these houses are popping way up in value. Too much for what they are actually worth. Trouble is, these homes are way over priced. They are dated. They are 25+ years old. But these people have been been told by realtors that prices are rising. Maybe so, but people like my husband and I know how much money these homes were built for and what taxes should be. We’ve been tracking this for fifteen years. Most couples our age can’t afford to play golf anymore. Or don’t care to. Most couples have not saved anything close to what they should. Will the world fall apart tomorrow? Maybe. But we cannot worry about that. We believe in the next few years housing will drop again
in this area because the majority of our peers can’t afford retirement. We aren’t rich, we just live within our means. People have moved to this gated community and over the years some have been foreclosed on. That still happens. We know a couple that make a lot of money with their combined income. They also like to spend it. Just found out he got his pay cut in half. Half! Been with that big corporation for decades.
How come every wal mart I see the parking lots are full. and the shoppers with full carts are in line waiting to check out? The AULDIS we shop at the same thing. Folks do shop for necessary things like food. its overpriced luxury items that don’t sell very fast.
The wife received a very good bonus and all of it was promptly eaten by taxes, and newer, higher property taxes.
And they wonder why nobody can save anything. There wasn’t even enough left to go out to dinner.
I don’t care. I hunt and grow my own food in MT. My house is invisible from the nearest main road 100 miles away. You have to quit worrying. Max out your credit cards. Disappear with the cash. Fuck the banks like they always fucked everyone.
The ACA turned our reasonable health care into we cannot afford to use it health care.
We are that small minority of Americans who live below our means, and put 20% into savings/retirement. The ACA made us work twice as hard just to be able to put that same 20% into savings/retirement.
We recently saw pay increases after the tax plan passed. Makes it easier to save more, as we see a time when the Dems take Congress and the WH and we will be forced to pay more taxes for someone else’s benefit.
We chose not to live in a high housing area, and picked something in a lower, rural area.
Keep in mind; Japan has been running the QE scam for over 20 years. This is not going to “collapse” anytime soon. This can go on much longer than any of us can imagine. Anyone setting themselves up defensively might be waiting a long time for the payoff. The market always outlasts our resources to wait.