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Peter Schiff

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Peter Schiff: "The Fed Won't Raise Rates, It's Part of the Bluff"

By , Associate Editor, Money Morning • @TaraKateClarke -

The Fed

An all-important U.S. Federal Reserve meeting on Sept. 16-17 will decide whether interest rates will be raised for the first time in nearly a decade.

But Peter Schiff, economist, best-selling author, and CEO of Euro Pacific Capital, doesn't think the Fed is actually even considering a rate hike, despite speculation.

In fact, he predicts the Fed may be forced into QE4. Here's why...

Peter Schiff on U.S. Dollar Crisis: "The Dollar Bubble Is Going to Burst"

By , Associate Editor, Money Morning • @TaraKateClarke -

Stock Market Crash

Peter Schiff, economist, best-selling author, and CEO of Euro Pacific Capital, believes a U.S. dollar crisis is underway.

"The dollar is very overvalued...and the dollar is a bubble," he told Newsmax Prime on Aug. 11. "This dollar bubble is going to burst."

Indeed, two weeks later and Schiff's prediction proved timely. The U.S. dollar index has suffered a fourth-straight loss, and U.S. markets have plummeted in the worst weekly sell-off in four years.

Many blame the surprise yuan devaluation. But Schiff believes investors should be worried about the United States, not China...

Symptoms Don't Lie

By , Money Morning -

A good doctor will not simply make a diagnosis based on measurements. The symptoms and complaints expressed by the patient are at least as important in making a determination as the data provided by diagnostic tools.

When the data says one thing and the symptoms continuously say another, it makes sense to question the reliability of the instruments.

This would be particularly true if the instruments are furnished by a party with a stake in a favorable diagnosis, say an insurance company on the hook for treatment costs.

The same holds true for the U.S. economy. Although our government-supplied data suggests we are experiencing low inflation and modest economic growth, the economy shows symptoms of low growth, rising prices, and diminishing purchasing power

If consumer inflation data were accurately reported, it would be revealed that much of the apparent growth is an illusion. Peter Schiff explains.

Peter Schiff: "At some point, the dollar has to give"

By , Associate Editor, Money Morning • @DavidGZeiler -

While the U.S Federal Reserve claims it needs to keep interest rates near zero to help the economy, renowned economist Peter Schiff says there's another reason.

According to Schiff, the Fed has little choice: If rates began to climb, the interest payments on the ballooning federal debt would explode making annual budget deficits far worse.

"We're now so addicted to debt that the highest rate we can afford is zero," Schiff, the CEO and chief global strategist of Euro Pacific Capital, told Casey Research chairman Doug Casey in a video interview published today.

"We pay about $300 billion a year right now in interest on a $16.5 trillion debt," Schiff explained. "What if, in two or three years -- and the debt is $20 trillion -- what happens if interest rates are 5%? Well, that's $1 trillion a year in interest payments."

This scenario is not at all far-fetched; the historic norm for interest rates is just below 5%, and rates in the early 1980s were triple that.

Another reason the Fed fears higher rates, Schiff said, is that it would probably bankrupt most of the "too-big-to-fail" banks that the government bailed out back in 2008.

"The only justification for keeping rates so low is that the Fed knows any increase in rates will collapse this phony economy and we'll be right back in recession," Schiff said.

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Peter Schiff: Thanks to QE3, We're All Screwed

By , Associate Editor, Money Morning • @DavidGZeiler -

U.S. Federal Reserve policies like QE3 are building up to an inflationary catastrophe, says economic expert Peter Schiff.

Schiff, the CEO and Chief Global Strategist of Euro Pacific Capital, made his remarks about the dire consequences of excessive quantitative easing in a video interview on Yahoo! Finance's Breakout.

Schiff said he has dubbed the Fed's third round of bond-buying, known as QE3, "Operation Screw" because "everybody's pretty much screwed if they own dollars."

He warned that the Fed can only continue its policies of buying U.S. Treasuries and mortgages by printing more money, and printing more money inevitably will drive much higher inflation.

"The Fed is now promising to print $85 billion a month," Schiff said. "That's over a trillion dollars a year. And I think that's just their opening bid."

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Peter Schiff: If You Think the Fiscal Cliff is Bad, Just Wait

By , Associate Editor, Money Morning • @DavidGZeiler -

Forget the fiscal cliff, says economic expert Peter Schiff. This country faces a far bigger financial crisis.

While the failure of Congress to act to prevent or mitigate the fiscal cliff - the combination of tax increases and federal spending cuts due to hit on Jan. 2, 2013 - would slam the economy hard, Schiff says it would be preferable to the crash he foresees.

"It's not because we go over this phony fiscal cliff, it's probably because we don't go over that one because the government cancels the spending cuts, cancels the tax hikes, and instead we end up going over the real fiscal cliff further down the road," Schiff told Breakout recently.

Schiff, the CEO and Chief Global Strategist of Euro Pacific Capital, said the real threat to the U.S. economy is "where interest rates spike and we can no longer afford to pay the interest on the enormous amount of debt we have."

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