EXCLUSIVE: Peter Schiff Interview By Jimmy Mengel | Monday, July 15th, 2013
I had the pleasure of sitting down last week for an interview with an ever-invigorated Peter Schiff, who treated me to an all-you-can-eat buffet of enlightening metaphors and bon mots.
Now, if you aren't familiar with Schiff's work, allow me to get you up to speed...
Widely known as one of the only analysts to accurately predict the housing collapse of 2008, Schiff was warning of the subprime mortgage crisis back in 2002.
When he tried to warn people of the forming bubble, he was frequently jeered and even laughed at on national television shows... but Schiff had the last laugh when that house of cards came tumbling down. And that's why when Peter speaks, we tend to listen. In the following interview, Schiff shares his thoughts on the current and future states of the U.S. economy and Fed policy and, as always, makes some dire predictions... Hi Peter, thanks for taking the time to speak with Outsider Club. It's my pleasure, thanks for having me. You recently said that the Fed really has no plans to roll back its Quantitative Easing program, and Bernanke's recent comments were basically a bluff. Can you elaborate on that?
Well, the Fed never learns from its mistakes. It's not like the Fed is gonna do QE and then when the economy doesn't recover, they say that was the wrong medicine and maybe we should try a different approach. They'll never do that, they'll just go ahead and do it all over again. They'll just say "Hey, I guess the last one wasn't big enough..." They will never acknowledge that is doesn't work let alone admit that its actually the problem itself. It's like a drunk trying to sober up by drinking more and more liquor, and then say "I don't understand, I keep drinking this liquor, and I cannot sober up!"
The Fed is trying to sober up by drinking and I know it's not going to work. At some point they had to start talking about an exit strategy, they have to pretend there's actually a way out. There isn't... They won't sell any of these bonds, because who is going to buy them? Nobody. All this talk of an exit strategy is B.S., a bluff. But the Fed has to pretend, other wise they have to admit that the increase in the money supply will continue forever.
But now they are just talking about tapering, not exiting. Tapering is simply growing the balance sheet more slowly. Bernanke's own words were: "We're not stepping on the breaks, we're letting off the accelerator."
But the car will keep moving forward. We need to slam on the breaks, come to a complete stop and THEN put it in reverse. They have to go backwards. And they certainly aren't doing that.
SLR Price at posting:
72.2¢ Sentiment: Buy Disclosure: Held
