Peter Schiff, the President and CEO of Euro Pacific Capital, and one of the few who predicted the 2008 Great Recession before it happened has said that what we are experiencing now is “the beginning of the end.” Schiff made his comments during his keynote speech at the Vancouver Resource Investment Conference.
The economic guru says that the Federal Reserve has made the decision to halt interest rate hikes in order to attempt to save the flailing stock market – the key indicator for far too many of how “healthy” the economy is at current. According to Seeking Alpha, the markets responded to the Fed’s decision in a positive manner, leading many to think we are “out of the woods” and no longer in danger of a recession.
However, Peter traces the moves of the Federal Reserve all the way back to the first rate hike of December 2015 and shows how the central bank has put the United States on a path toward a financial crisis that will be bigger than 2008. Peter insists he’s been right about what would happen all along, it’s just taken us a little longer to get to the actual financial disaster than he expected.
“The reason that I originally said that I did not expect the Fed to raise rates again was because I knew that raising rates was the first step in a journey that they could not finish, that in their attempt to normalize rates, the stock market bubble would burst and the economy would reenter recession.
Normalizing interest rates when you’ve created an abnormal amount of debt is impossible.
I knew all along that at some point, that would be it, you know, the straw that breaks the camel’s back. I didn’t know how many rate hikes the bubble economy could take, but I knew there was a limit. And I still knew that there’s no way they were ever going to get back up to normal or neutral. Whatever that number is, it ain’t 2%.” –Peter Schiff
Schiff also cautioned against more quantitative easing (money printing.)
We’ve just created a massive amount of inflation. Quantitative easing is just a euphemism for inflation. That’s what inflation is – expanding the money supply. Printing up money and buying government bonds is the definition of inflation. The Fed has been inflating like crazy. –Peter Schiff
Unfortunately, people will look for the central bank to save them from this disaster the central bank has created. But there’s nothing the Fed can do to help anyone once the debt based economy implodes and the sooner people realize that, the better off they will be and the more likely they are to prepare themselves and their families for what the Central Bank has planned.
People are going to realize that we checked into the monetary roach motel that I talked about from the beginning and that there’s no way out, and then the dollar is going to fall like a stone.
When they find out that it’s never over and it didn’t work, then there’s going to be nothing propping up the dollar and it’s going to drop like a stone, the price of gold is going to take off, and the recession that we’re entering into, which is going to be an inflationary recession, is going to be worse than what we now call the Great Recession.
Maybe it’s taken longer than we might have thought to play out, but this is the beginning of the end.” Peter Schiff
Stuart Varney said on Fox And Friends the booming economy will last through the end of the year. There are however two hidden bubbles Debt, and derivatives. Plan accordingly. America’s money is created by the Federal Reserve and backed by the government indebting the people. I have done a study on the Federal Reserve, scroll down to Federal Reserve Note Click here
funny what you find when you use the search function on this site:
2017 the Beginning Of the End: “U.S. Economy About To Get Slammed By A Major Recession”
Michael Snyder – February 9th, 2017
2 years, almost to the day.
Schiff predicted the housing bubble would pop in 2003, but it didn’t happen till 2008. So?
When has debt not been a bubble?
Rellik
I look at “Derivatives” as the financial equivalent of a cascade loop in a very complex SAMA diagram.
K2,
I haven’t commented on this post, but since you yanked my chain,
could you elaborate? I’m a Systems designer so I deal with deterministic things. Derivatives are anything but deterministic.
When you design a system, you attempt to make it robust enough to tolerate failures and random events, in other words, Failsafe. The system either produces the desired outputs or it halts in a safe state. So humans can intervene and correct the problem.
Derivatives are not Failsafe by any stretch of the imagination.
My experience is operations and not design. From my perspective it’s the variables that are incorporated in the system, each having a variable contribution, non linear to the final SP. X is important under these conditions by Y is under these and they’re all variable. Add in one or more false imputes and the result is not just instantaneous but unpredictable. The unpredictability of result due to complexity in event of error in input by forces unseen, not thought of from causes that are initially thought of trivial having an extreme outcome (long winded) is my similarity. A small event sets off a series of things that after the dust clears one says, “how in the hell did a mouse shut down an entire power plant”?
Failsafe? Not in my world.
The dynamics are dynamic.
K2,
I had no idea that power plants were designed that way, I would have thought more attention would be paid to failsafe. I know they have a lot of built in protections from grid disturbances.
I suppose that is why it takes so long to recover from a major Blackout.
My experience is airplanes where failure is not an option. That is probably why they cost so much. Aircraft are VERY dynamic.
There are interlocks that are hard wired (and often they are intentionally bypassed) but the complexity of the controls, the unseen variables especially in an oil refinery where there exists a symbolic relationship that doesn’t exist in a conventional public utility. The goal is to keep running at almost all cost. The most rare thing is for anyone to shut down anything for almost any reason. The Monday morning quarterbacking makes the Spanish Inquisition look easy, been through it.
I guess my comparison to derivatives is a tad more understandable from my perspective.
K2,
My High school Chemistry instructor was a retired Shell oil company Chemist. He had a story about a new engineer hire at a refinery that made an incorrect decision to shut something down, causing several tank’s contents to harden up. The new hires job was then to clean out those tanks. Upon completion, after lots of his physical work and the tanks were functional again, they fired the guy.
I suppose that is why I didn’t pursue chemical engineering( I was straight A and even tutored in college level Chemistry).
Peter Schiff is full of shit.
TRUMP’S policies have changed the trajectory of the ECONOMY. The ECONOMY is NOT the stock market. I told this community months ago to expect the stock market to ratchet down to a level consistent with revenues. That is happening, has happened as the ECONOMY resets and the stock market bubble deflates.
Yeah, it’s in the archives. 🙂
durangokidd, we don’t always see eye to eye on economic issues but I can find no fault in Schiff’s statement: “Normalizing interest rates when you’ve created an abnormal amount of debt is impossible”.
“I knew all along that at some point, that would be it, you know, the straw that breaks the camel’s back. I didn’t know how many rate hikes the bubble economy could take, but I knew there was a limit. And I still knew that there’s no way they were ever going to get back up to normal or neutral. Whatever that number is, it ain’t 2%.”
This statement sums up my position exactly.
Yes it may be impossible to “normalize” interest rates anytime soon, whatever that means: I would think it would mean 4% +/-. But the current rate environment may be the “new normal” for a long time. Who knows ???
The important thing seems to be that TRUMP has jawboned the FED into reviewing their previous stated policy that would certainly have crushed the “Trump Recovery”; and businesses are hiring and consumers are still optimistic. That doesn’t mean that they will continue to accumulate personal debt, and may in fact be looking to stabilize or reduce that debt and increase savings. Time will tell.
The Uber Rich Investment Class have enriched themselves at the expense of the Middle Class for 30 years and it seems to me that they have begun to realize that they went too far, nearly killing the “Golden Goose”: the American consumer.
Ultimately the death of the American consumer is the death of their businesses and the source of their wealth. TRUMP gave them a wake up call. It seems to have worked. Now they are worried that socialism is just around the corner with high marginal tax rates that would rain on their parade. They would rather share voluntarily and keep the status quo, than be forced to share beyond their control.
Thus the pendulum swings. 🙂
Peter Schiff AGAIN? Ho hum, back to sleep.
Sorry, but nope. politics won’t solve this now.
Contrary to articles you have read here, about how TRUMP TARIFFS are hurting the economy and American companies, most American CEO’s see their company (and thus their workers) benefitting from TRUMP’S TARIFFS !!!
https://www.zerohedge.com/news/2019-02-14/majority-us-ceos-see-trumps-tariffs-helping
🙂
It took more than a year to get into this mess and it’ll take more than a year to get out or at least improved.
As an exremely qualified buyer with a pre approval from my mortgage company I made a great offer on a mini farm and the owners refused because offer was 3% less than what they would take. It needed over $50,000 in needed repairs plus updating the home (18 yrs old). Money is cheap and has made sellers falsely believe they can get extreme values for their property. A Million dollar home today is what sold for $400k just 0 years ago. Yet wages are stagnant. Dealing with idiots in love with their for sale property is not something I suggest. Anything is worth what a qualified willing buyer is willing to pay. Its been on the market 3 years already. They lost 3% in their stock portfolio in 2 days i the last few months. They will surely feel their stupidity in the next 18 momths when even I cannot qualify to buy it because banks wont lend just like in 2008-2010. Nobody was lent to. Never underestimate the stupidity of people.
Schiff the Broken record.. When the controllers want to pull the plug on the economy they will.. Schiff is sitting heavy in Gold and wants a melt down so he can profit with has gold holdings. I’m sitting on Silver as well and frustrated and the Foot on the Brakes. Its all manipulations. Just be debt free and have some saved assets and you will still thrive in a crash.
“the sky is falling”
This guy and all the 1,000’s of YouBoob procrastinators are in a business where they can perpetually regurgitate the same story over and over and over, even though he was only right ONCE.
Recessions occur, it doesn’t take a Greenspam to tell anyone that.
The fact of the matter is the central banksters will not allow this thing to deflate.
As long as the planet has resources to extract and humans continue to multiply [or immigrate] there will be growth along with short periods of recession, followed by even greater highs.
I guarantee you that if the internet is alive in 2119 the great grandchildren of these assholes will still be posting these pathetic “the sky is falling” predictions.
A lot of people have spent a small fortune buying items in anticipation of SHTF.
The majority of these items bought specifically for SHTF,will never be used for their intended purpose and will collect more dust than anything else..In order to justify spending so much time and money on SHTF supplies,people will constantly proclaim that SHTF is just around the corner..You will notice however,these same people are not quitting their job,they’re not fleeing from the city,and continue their regular routines..Fact is,even the die hard SHTF believers have serious doubts that SHTF will happen and have turned the whole “SHTF phenomenon ” into sort of a hobby as a way to pass time..If you truly believed SHTF would be happening any day now you would take the initiative and leave the city NOW,not wait around to see what happens..
Don’t panic just try to do what you can as this can play out for years. Probably a slo mo train ride to hell. Id sprefer fast and furious but our leadership needs to be able to position themselves for longevity. What happens to us isn’t important. Just give them your guns and shut your mouths slaves. Enjoy your poverty. Live Long and Forget Prospering.
Probably will be but it might be a little longer than what All the fortune tellers are spouting. Trump has got the FED to whoa up on increasing the interest rates for now and it’s “Happy days are here again” for the stock market. My main concern is something coming here that is so cataclysmic, that it’ll paralyze many.
ALL empires collapse and the USA will be no different.
I am of the same mind that you are – I feel it in my bones that something(s) are around the conner.
Russia invades Ukraine – Nato vs Russia/China
Iran or other rouge nation sets off EMP’s
An engineered pandemic is released
Iran invades Israel
China sinks a US ship in the Pacific
A super volcano goes off
etc etc
Or we elect a socialist government….self-destruction.
Or D) All of the above.
Not normally a pessimist, but WWII is an example of numerous things falling apart in wildly varying global areas. The US was fortunate not to have any more problems than recovering from The Great Depression. Here’s hoping our good fortune continues.
These assclones are a part of the LOL million dollar prepper industry. The sky is falling.
99.99% of the people on the internet don’t understand money. These ‘henny-penny-bezos’ scare you, and they are there to sell you their products, books, gold, silver, bitcoin, seed vaults, water purification, you name it.
Even this URL is here to serve and extract from those that believe in things that just aren’t true.
Bert what you say is true. The fear is put out there in many venues to get people to spend the money they don’t have. Recently here was an article talking about folks being behind on their car payments by 90 days. The talk of defaulting on college payment has recently gone under the radar but it is still happening. The mountain of debt will at some point consume this nation.
I followed many of their suggestions over the years. I still have hundreds of rolls of nickels that Rawles said would one day be valuable for their melt value, thousands of pre 83 copper pennies for, ya know, “melt value”. It’s funny now, but back then I thought it was the right thing to do.
I’ve been gradually getting rid of things, but I’m getting old and my kids will have to clean up the stuff, most likely cussing me out the whole time.
Awesome!
Exactly Bert…All they want is your money..Truth is, a substantial amount of so called “survival items ” are unnecessary and overpriced..Common sense and KNOWLEDGE is worth MUCH more than what these “doom/gloom” sites have for sale..Get outside and LEARN from actual,hands on experience..Nothing takes the place of real world,hands on experience..Books and theory will only take you so far..The rest is up to you..
Peter Schiff, the President and CEO of Euro Pacific Capital, and one of the few who predicted the 2008 Great Recession before it happened
Well…… No Shit.
He would have looked like a retard if he predicted the 2008 Great Recession AFTER if happened.
Maybe this article should start by just saying he “predicted the 2008 great recession.”
The light at the end of the tunnel is a supernova.
Cultivate at least two practical skills that you can trade as a favor which will be reciprocated as a favor. They are both “gifts” not income or barter.
This might be teaching either standard education like math or geography, or practical ancestral skills.
There is no question that a recession is coming but you can’t stay in cash. At least I can’t. Cash pays nothing. There are good quality stocks paying good dividends. Just have to be prudent. Also set some money aside for gold silver food. Grow a garden and for goodness sakes don’t live in s big city. It will be horrible there!!!
AI, robotics, and automation will synergistically and vastly reduce jobs. And as a result, men and ladies will be very picky about marriage as income will dramatically decline. That means that they will be forced to do ancestral skills because no one will pay them, and the taxbase will be destroyed, and government employees will be RIFed.
This is going to cause massive culture shock as most will have no worth and very poor self-image. They won’t be able to cope, so many will turn to crime, but that relies upon disposable wealth, so that will fail. Less government employees means more cowboy justice.
Look at history. There was little crime outside of theft as there wasn’t disposable income outside of a “harvest time. 90%+ of people will have no job to do or a way to make income from what they know.
This means some will turn to security work who have actual soldiering skills or most will become serfs because there won’t be fuel. Sure it will be in the ground but how will anyone pay for it? Not for international trade.
Let’s say you raise MJ and you make ethanol. Buddy, that could be income so based upon the harvest, as you get it in or make it, then it can be stolen.
And it has no value as income if they can’t pay you. What most likely happens is some scavanger, who harvests out of abandoned homes, has found something you might need like some tools.
And criminal enterprises like gambling, ethanol sales, prostitution, loans with vig, extortion, these didn’t just happen without major ranching and miners going on. That won’t be around.
Let’s say you are a reloader. Are you really going to sell ammunition that may end up being used to harm you? Don’t you think another tribe will try to take what you have and or abduct you and your operation?
Mabey if everyone was prepared for a shtf senerio it would never happen you know through readiness or something of that effect I mean we out number the government people a large croud of us to their 1 so if all of us cared more about our family’s and our family’s being ready for anything we would probably put a stop to all of this debt bs and be a month ahead on everything and get 1 out of 2 people or better working for themselves in one fashion or another and it might start looking like America again with people all happy like and everything
Oh no! Even the peep’s on SHTF are thinking it wont happen. We are collapsing. It a slow collapse, just read and you can see it.