1/22/2010 Peter Schiff On Fast Money: Is China In A Bubble?

[TheMEK3]

Tim Seymour really hates Peter. smh

[mtmjr77]

The Chinese Renminbi now only costs 6.586 per U.S. Dollar from up 17%.

[louiethegreater]

Wow, can't believe anyone would want this guy in congress. He will not invest in his own country. He holds a lot of gold, so he promotes gold, sounds like a self serving statement, insomuch as he can influence so many people.

[Berelore]

@louiethegreater

some would call it putting his money where his mouth is.

[louiethegreater]

@Berelore No-- it is putting your mouth where your money is.

[Berelore]

@louiethegreater

Well lets see the day this was filmed almost 2 years ago gold was at 1092.50 an ounce as I'm typing it's at 1725.5 an ounce. I'd say that buy gold was pretty sound financial advice and that he was and has been correct in recommending it.

If you don't think putting your money at risk in the commodity that you are advising others to buy is putting your money where your mouth is then you sir are a low grade moron. I will waste no more of my time on you.

[louiethegreater]

@Berelore When Peter and his pals decide to sell, you dingbat sucker--- will be looking for someone to buy your degraded gold for a few cents on the dollar. Better sell now moron. How does it feel to be a Chicken Rooting for Colonial Sanders?

[johnywinslow]

WOW how many YEARS does schiff have to make these people look stupid until they start listening. this kid is fresh out of modern economic playschool.

[quadcatfly]

buy gold and silver. nuf said.

[konshoff]

it's 3 weeks later and China along with Japan lowered its US treasuries positions by 50 billion. ( just for start). China is putting slowly breaks on its overheating economy and this is a result.

They will buy less and if the RMB goes floating then its even worse. the gold can goo easily to 1700$. will see

[fuckpopulations]

what we need to do, is to have mass killings throughout the us. Too many people and too many idiots = not enough jobs more and more problems and more tyranny. Half the population must be wiped out. Stalin style

[tesla921]

Put your money where your mouth is. Kill yourself! Two birds with one stone. One less person and one less idiot.

[rmccay88]

@fuckpopulations

I am in support of that plan, only if we can whip people off who think like Keynes and voters who voted for Obama. That's a real economic stimulus plan.

[TheLiberalssuckdick]

fucking Tim, you bitch.

[chrispcarrot]

@TheLiberalssuckdick 'Tim "The Assador" Seymour. Another ass-hat who dissed PS before the crash and STILL can't listen to a guy who proved them all wrong. How this clown gets airtime is beyond me...

[DiebelsZackspeed]

He must have high connections inside the broadcasting company.

That's the only way assholes avenge in this world.

[shaunzane]

Tim Seymour & Numonic7 don't understand what "Carry Trade" means; it refers to the yield differential. The US$yuan peg refers to the "Value" only, not the coupon rate on Debt Notes. If you were attempting a carry trade this "peg" would be beneficial in the sense it would remove currency risk, however, in the long term it is in China's interest to float the currency as the increased purchasing power of their yuan would offset any inflationary pressure. Get your facts right first b4 you speak

[Numonic7]

"it is in China's interest to float the currency as the increased purchasing power of their yuan would offset any inflationary pressure" So would contracting china's consumer credit like they recently just did, except with contracting china's consumer credit while maintaining the peg, it appreciates both the Yuan currency and the US$ as the peg would appreciate the US$ with it as it currently did. I'm thinking more about the interest rate spread but I doubt it effects the value bcuz of the peg

[shaunzane]

Also, contracting consumer credit in China would inrease their domestic purchasing power, however, your explanation of the peg is incorrect. The Dollar's rally is "market noise"; by tightening monetary policy in China funds would flow into their debt notes and away from other countries who would have lower interest rates ie. America and Japan. This is what Peter was explaining but Tim decided he didn't want to listen, and instead continued with his usual rhetoric.

[Numonic7]

My explanation of the peg is correct & it's simple, if I peg the Yuan to the US$ then what ever happens to the Yuan also happens to the US dollar. It's as simple as that. And your explaination is vague and copied from what Schiff said: "market noise", what kind of explanation is that? The interest rate spread is a croc bcuz China's banks used to be extremely tight with credit and this did not move the value of the Yuan away from the US$ which is also apreciating bcuz of US' credit contraction

[shaunzane]

and what I mean by "market noise" is that people will always speculate on news events, despite the fundamentals being the complete opposite. The increase in interest rates in China is Positive for the RMB as the higher yield will draw more funds into China and away from lower yielding currencies such as the USD. This is negative for the USD & yet the USD rallied in the short term, based on traders misunderstanding the fundamentals. This is no different from Real estate speculators b4 a crash.

[Numonic7]

That being said, most of what has been going on in the US since late 2008 to today is deflationary and would be appreciating the US$ had it not been for China's great 2009 credit expansion which also caused prices on tangibles to rise so high. Granted there was some ease of credit in the US in mid 2009 but even that ease of credit was dwarfed by the US' contraction of credit from late 08 early 09. China's current credit contraction coupled with US' credit contraction is why prices are falling.

[Numonic7]

I'm watching bloomberg and Wang Qian, an economist with JPMorgan Chase & Co. in Hong Kong mentions the same thing about how widening the interest rate gap between China and the US would definitely attract more hot money in to China and that that would increase the appreciation pressure of the ?Yuan?. It's here: watch?v=u1Fmk05SG9w but I still don't get how the carry trade works, i have to read up on it.

[shaunzane]

Here's an example; If the US lends money to you @ 0.25% and for argument's sake let's say the rates in China are 3%; you would invest your loaned USD in China @ 3% and the difference would be your profit: 3 - 0.25 = 2.75%. The fact that the Yuan is Pegged to the dollar removes any currency exchange risk because the value of the Yuan cannot fall against the USD and so your 2.75%.

[shaunzane]

I get the feeling that Tim Seymour is blinded by his patriotism and as a result he is unable to look at things rationally. His attitude is reminiscent of Art Laffer's in the "Peter schiff was right 2006" video. I'd bet a "penny" that Tim will find himself in the same situation that Art did in a year or two.

[shaunzane]

muhaha... Tim Seymour continues to embarass himself. He should look up "Carry Trade" on the internet. And he also assumes that simply by talking over Peter's comments it makes him right. What a donkey!

And he's completely wrong about treasuries; watch the decline in the dollar. By hiking rates, they are signalling that they expect to float the currency soon; Rising interest rates are symptoms of strong currencies. Look @ how weak the USD and JPY are; their interest rates are @ 0%

[Numonic7]

"Carry Trade"? What carry trade could exist if the Yuan is pegged at a flat rate to the US dollar. That means when the Yuan appreciates against other currencies, the US dollar appreciates just as much because the US dollar is pegged at a flat rate, around 1 Yuan for $6 to the Yuan. So the Yuan can't appreciated or depreciate against the US dollar unless it is done through the peg. Yes China wanted to appreciate it's currency but it did so in a way which brought the US$ along with it.

[shaunzane]

i'm referring to the yield differential; I am aware that the VALUE of the RMB is pegged, but this doesn't mean that the spread between the US yield and RMB yield can't increase. THIS is what I mean by carry trade; you should look it up as well.

[Numonic7]

All China's commercial banks did was decrease the amount of consumer loans it was making, that means it gave out less credit cards and less mortgages to the Chinese people. It has nothing to do with the US$/Yuan peg which mind you did not move at all. A signal that China espects to float the currency soon is if they started moving the peg lower, meaning making it cost less for China to buy US$'s, meaning the peg move to like 3 Yuan for 1us$ but that did not happen, the peg did not change.

[focus21x]

Who is that young dummy in the blue shirt, with a big smile and no brains?

[Numonic7]

Schiff says China can not tighten it's money supply without NOT buying treasuries, this guy must have missed the passed decade before China started expanding credit. China had high reserve requirements and consumer credit was tighter than ever and at this time China was buying more Treasuries than it ever did. Schiff refuses to address the current credit contraction issue and continues to confuse it with the Yuan/$ peg which has nothing to do with the issue at hand.

[polarbeach]

@Numonic7 how do you really feel about it  lol

[Numonic7]

well I realize that we are slaves to the commercial banks of our nation. Your employer isn't who you think it is, your employer is the banks who choose to lend to your company to keep you in business. The borrower is the slave to the lender. Why are you lol? what's funny?

[Numonic7]

well correction, credit is enticing but it is not necessary as necessity is the mother of invention, so the world would be more productive without credit and thus there would be more jobs without credit and more producing without credit. I believe that the increase in productivity would more than make up for those that really need the charity. But credit is so enticing that people would rather get the money for free than produce for it, most charities discourage productivity.

[Numonic7]

China did not come out and say it will stop buying US treasuries, it said it will decrease lending to it's domestic population. The contraction of credit isn't happening to the US, it's happening to the Chinese people. Just because China is contracting consumer credit does not mean it is contracting credit across the board. It is specifically contracting domestic credit. That has nothing to do with their credit towards the US. When they increased consumer credit, it didn't effect treasuries

[Numonic7]

Also Schiff is incorrect about the US treasury debt issue he brought up. If China's asset prices are falling, China will choose to park cash with something rising and treasury debt is one of those things. On top of that, the panel guy is totally right, treasury buying has nothing to do with this discussion. China is buying as many treasuries as it can and is maintaining the peg, Of course China treasury buying will drop if US consumerism drops, China gets less dollars to buy T-bills with.

[ghawk1232]

R&B?

[shaunzane]

@ghawk1232 haha.. they meant "RMB" which is another term for the Chinese Yuan. The terms are used interchangeably, but they mean the same thing.

[Numonic7]

Ironically Schiff says "Look at what's happening to the Chinese domestic economy" but fails to address the recent credit contraction in China. Avoiding it by all means and confusing people by intertwining the US$/Yuan peg rate with the commercial bank interest rate, the latter being the issue of discussion which Schiff does not want to discuss due to the recent credit contraction in China which devastates his argument that China will appreciate it's currency by dropping the peg.

[Numonic7]

If the peg is flat, Schiff says the Yuan can't fall against the dollar but refuses to see that it can't rise either, so what rising yield is this guy talking about.  Man, Schiff will never admit being wrong. Even on the smallest things.

[Numonic7]

The reason he says the interest rate rise in China will be bearish for the US dollar is because he is confusing commercial bank interest rates in China and the US$/Yuan peg rate. He refuses to see that China has 2 ways of appreciating it's currency. 1. by contracting credit and 2 by dropping the US$ peg. China chose the former and that means China is choosing to maintain the peg and bring the US$ along for the currency rally and this is devestating to Schiff's argument.

[Numonic7]

Peter schiff see's the truth, admits the truth and still refuses to own up to the truth. Schiff admits that the US dollar rallied on the news that China was raising rates and then Schiff goes on to say that China raising rates is bearish for the dollar. First of all it wasn't the news of China raising rates that rallied the dollar, it was the FACT that China RAISED rates that rallied the dollar. He is acting as if the rate rise did not happen, well it did and the dollar rallied.

[Numonic7]

Schiff & the panel are confusing bank interest rates with the Yuan/US$ peg rate. Schiff is basically arguing that China will drop the US$ peg, the main question was about the contraction of credit/bank interest rates rising China did, Schiff did not address this. Of course dropping the peg will mean Chinese imports will become more expensive to US but China is choosing to appreciate it's currency by contracting credit instead of dropping the peg, meaning China still cares about exporting to US

[jasonw1215]

I like Schiff but I think he is wrong on China

[pxujistas]

so what happened to freedom of speech? you cant even voice your opinion on what to buy?!? :/

[Clerenn]

"You can't keep quiet, come on" is what he says in the end.

Schiff gotta work on the manners though, let ppl finish their sentences.

[wtfbroskie]

i agree

[EMPIRE0FLIES]

Went through a fast food drivethrough just now. Overheard a woman in the car in front of me say" One chicken soft taco and any scraps you can spare for my dog. Im living out of my car" I look to my left, I see camping tent on the sidewalk.  And this is Orange County Califonria!. The market is being manipulated. Gold is being manipulated. Get out of th dollar!

[xylikiticatacoltyx]

I wanna kick these blue shirt douchebags on their balls and I esp wanna take a shovel and slam that pink shirt bald head idiot right on his head and bury him alive. These guys are more actors than professionals. Peter schiff, you rule.

[karhu1913]

Does the jackass say in the end "you cant keep lying comon" ???

What an insult.

[1bchrisd1]

"you cant keep quiet comon" thats what he said

[audiohi]

Tim Seymour, the guy on the left

is like that guy in high school we all knew, that acted like a fag and thought he was amazing

christ the guy even slicks his hair back. I wanna punch him in the face.

[SilencerRPMs]

@audiohi hahahahhahahahhaaa.  well said

[israelandersonvideo]

Some TV jockey trying to school The Schiff.

THAT'S funny!

[kobe88124]

Tim Seymour is a fucking slut! if i ever saw that guy on the street i'd punch him in the face! he's always the contrarian w/ peter, disagreeing for disagreement's sake. the worst part is he doesn't know what the fuck he's talking about. when was the last time he ever predicted anything and wrote a book about it and had it come true? it doesn't matter though, i think he's just jealous that peter's been getting all this attention and is running for senate. what a bitch!

[MIT2004]

This is not the episode i saw today at around 4:36 PM central time. Is this one that came out today 1/22/09?

[forexfantasies]

Tim Seymour is an absolute moron.

[Shaunt1]

I hear from different sources that the stock market and gold are going to crash this year, I'm beginning to worry about my gold & silver investment and wondering if I should sell and short the market.

[MIT2004]

Dude if gold and silver have kept their value for thousands of years what makes you think they are going to lose their value?

[doobsta]

short term paper idiocy...

[62636263c]

The only problem I have with Peter is his Liberal stance on social issues. But he is brilliant on the economic side. I have to say though, these Fast Money guys are really lost on the macro side of economics. Maybe it's just theater, if that's case they play devils advocate very well.

[kobe88124]

too well, these guys are either bought or dumb...my money's on dumb.

[petiemac12]

END THE FED....Peter Schiff for Senate 2010...Ron Paul for President 2012!!!

[Intervene]

Go Peter!!! Top video

[tmac9938]

LOL HAHAHHA

CNBC is playing some hip-hop beat at the end of the segment.

[chrrrr]

That guy laughing has obviously never seen the Peter Schiff was right video and he'll be so embarassed when Peter Schiff Was Right v 2.0 comes out. What a fool.

[totalfloat]

Thanks Phil for postintg this. Keep up the good work.

[emirnkamelia]

Peter Schiff is so smart...

[pansemuckl]

Real estate is a trap too: Citizens are liable with their money, taxes and property to the national debt. Buy a house now, and enjoy some chinese to hijack it in the future. You cannot secure you're wealth by buying real estate...

[gutrp]

that annoying chick atleast tried to be nice to peter this time

[Zeldovich]

Schiff is a neocon Zioniist on foreign policy. It's unfortunate, but true. He's no Ron Paul.

youtube com/watch?v=73vVEY8zNCE

[Epic878787]

I have heard him express willingness to bomb a sovereign state because it didn't comply with the Nuclear Non-Prolif Treaty.  And his assessment would be based on "intelligence".

Disturbing indeed.

I don't consider Schiff to be a neocon at all. It's just his strict libertarianism on non-social matters that makes him seem like a globalist - and therefore, imo, neocon.

Imo, N-cons pretend to be social conservatives to get the Christian Right to go along with their globalism\treason.

[tmac9938]

another mis-informed person calling peter a neo-con. none of you guys have any real shit to pin him on.

your first paragraph is relating to when peter was talking an EXTREME case. also, he said you only use the military when national security is LEGITIMATELY threatened and diplomacy attempts have failed. that is NOT neocon. with war, neocons shoot first and ask questions last. neocons also spend first and ask quetsions last just like progressives.

peter is neither. dont be so dull.

[Zeldovich]

We have no interest in preventing Iran from doing anything, but attacking us. I guess you're a neocon too.

[Zeldovich]

Your position is at least as legitimate as mine.

[pntrain5]

taken way out of context. Knee jerk response, empty treat, pretty much a black and white statement that he's not an expert on and only expressing his personal opinion, not what he would actually do

[Zeldovich]

lol So, you don't take him at his word and you think you know better? lmao You're like one of those bling Obamabots who saw whatever they wanted to see in him. Now, just one year later he's already looks like a failed president. lmao

[fakeplasticme]

Schiff hasn't really clarified his foreign policy ideals just yet, and anyone who makes a firm, stereotyping determination on the man's politics based on some off-the-cuff statements is clearly just demogoguing because he hasn't any other way of debating Peter's points.

Thanks Zeldovich, for showing us all how debates are carried out in grade school.

[Zeldovich]

If you heard his comments and weren't disturbed by them, then you're a neocon or liberal interventionist too.

[tmac9938]

LOL and zeldovich calls him a ZIONIST! HAHAHAHHAHA

how is peter anywhere NEAR illuminati-related persons. i suppose ron paul is illuminati as well?

get the fuck outta here.

[Zeldovich]

Schiff's jewish, rich, and wants the US to protect Israel from Iran. What do you call a Zionist?

[Choros22]

A Zionist is a ideology, there are more Christian Zionists in the US then there are Jewish Zionists and not all Jews are Zionists. Peter Schiff would be pro Israel but I doubt he understands the broader geopolitics. He would not support genocide or refusing to sign peace agreements. Zionists are war mongering maniacs. Thus Schiff really is not a Zionist. Zionists are enemies of the Jewish people and should be understood as such.

[Zeldovich]

I guess you have your own definitoin. Not every Christian who believes the jews are God's chosen people believe that Israel should exist. Some think Israel has to be destroyed as a part of the prophecy of end times.

Either Schiff supports Israel at our expense, and/or he thinks it's in our national interest to prevent them from getting nukes. How do you see it?

[kobe88124]

you're a dumbass, schiff never said that...quit putting words in people's mount jackass.

[Zeldovich]

Click on the link.

[Epic878787]

I think you need to look up the word, "Zionism".

If you think it necessarily has to do the "illuminati", well, "HAHAHHAHAHAHHA", lol.

[tmac9938]

yeah i know, different terms. i apologize for my laziness.

let me clarify. peter schif is NOT AN ELITIST. TAKE YOUR HEAD OUT YOUR ASS.

[Zeldovich]

Why does not being elitest have to do with supporting a policy that would help Israel at our expense>

[pcheyer]

Lol, this is just more fodder for Peter Schiff was right videos. 2010 versions coming soon, with shaking heads and all.

[0musing]

Over the long term, China might be a good bet. But China does need to export! Their domestic consumption is zilch! They save too much and underconsume...China is headed for some sort of crash in the near term and they will face inflation plus recession or stagflation.

[fakeplasticme]

Domestic consumption is ramping up and will continue to do so as the rate of export goes down. Also...there is no such thing as saving "too much". Savings is where capital investment comes from. As long as there are surplus savings new and productive businesses can open, and job growth can continue unabated. And in a free market, underconsumption is corrected by lowering production output...giving the workers a balance of labor and leisure time as well.

The invisible hand FTW!

[jonvssocrates]

China = USA 1990

USA = Japan 1990

[kflee82]

@jonvssocrates

hopefully for Japan, it won't be

Japan = China 1990

[AFRIKTODAY]

Here is the basic fundamental principle Tim " mainstream parrot" Seymour doesn't get:

Between China and the USA economy, which one is established on SOUNDER capitalist foundations?

China of course!

Therefore you go with the winner rather than the paper bubble!

[wreagfe]

Harvard (or whatever) boy with yellow tie, stfu, you're clueless.

[pschiffforsenate]

"They have 1.2 Billion People, they don't have to export anything."-Silence.......lol

[mrzack888]

life is a bubble, you born, you eat, you grow, then you die.

[eurohim]

If you factor in "you reproduce" it is a wash.

[twisted45]

how can he argue with peter after hes been correct time and time again

[markymarkuss777]

because you can't teach old dogs new tricks. that's why.

[haploid2k]

@twisted45 because he's not correct. I followed PS for quite some time, but I got stopped out of metals HARD this week. PS was dead wrong about gold. Everybody on the planet only wants dollars, including the Chinese.

Don't expect those of us who got our asses handed to us in gold and especially silver this week to be going back in anytime soon. You gold bugs lost a bunch of us permanently.

[shtosuka]

haploid2k: try changing your scope of time. If you are looking at gold and silver in one week as a bad play because it went down, how do you react on the weeks that gold and silver shoot up? The "gold bugs" are in long-term. Look at a chart that's longer than a week, and you'll be looking up. If you're still not interested, that's fine.

[vipero00]

@haploid2k If you got out now and lost then its because your a speculator and not an investor.

[eurohim]

I bought a ton of the stuff after I saw it drop. It seems to always do the same thing. It goes up a bunch, then drops back nearly to where it started, I buy, it goes up some more, drops down above that, etc. You just have to know how to play it. I don't short PM investments, so a bad week doesn't hurt me.

[BloodMech21]

hate tim.

[TheLiberalssuckdick]

Tim Seymour = Dumb ass.

I want to punch and kick his ass.

[JoeyPencils]

@TheLiberalssuckdick get in line!

[Tasadaru]

China's economy will correct, whether it will crash depends if their government inflates like hell.

[injected74]

Fast Money might as well have the cast of jersey shore as their expert panel.

[czargwar]

I'm glad Schiff shut that monkey down

[eurohim]

Yeah, that guy is looking too close. That's like trying to save power at home by unplugging your night light instead of your A/C to save on phantom load.

[fakeplasticme]

I hate hate hate that same douche who argues Peter's points every time he is on. It smacks of jealousy...you can see it in his facial expressions, and in his defensiveness.

[tiko2114]

@fakeplasticme Its not that he has a different viewpoint but how childish he is in argueing. "No they wont. No they wont." He should say something with substance.