Peter Schif Video Blog - April 9, 2011

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The congress came to a compromise regarding the government shutdown. Both sides are claiming victory that they have finally solved the deficit spending. In reality, no one has solved everything. They agreed to reduce the 2011 deficit by 1% of the budget. The government is saying that this demonstrates their resolve. If this is the best that we can do is this tiny cut, then this shows that America will never do anything to get their fiscal house in order. Change will only come in the aftermath of an economic crisis.

The dollar had a terrible week. Many currencies made record high. Gold and silver made record highs. It isn't a coincidence that the dollar is losing value and that prices are going up. It is a cause and effect relationship. The consequence of the government not getting anything fixed is that the price of everything is going to go up.

The experts are debating whether rising commodity prices will lead to inflation. But the rising commodity prices are the manifestation of inflation that has already entered the system. The supply of money affects the supply and demand curve of oil. If there is more money in the system, then there is more demand for oil, because there are more dollars bidding for the same amount of oil. It is like an auction in which everyone has $1000 instead of $100. This is exactly what is happening in the commodities market.

The president of the Dallas Fed said that we shouldn't monetize the debt. But that is exactly what they are doing. People are saying that the reason that the United States won't face a crisis like Greece because they can monetize their debt. But the Dallas Fed President is saying that monetization is even worse. And he is right. The longer we wait to to the right thing, the more painful things will be. The British didn't raise rates, and raising rates is the right thing to do. The Fed is doing nothing, and the consequences will be dire. Interest rates have been inching higher, but we will see how the markets react to the bad news out of Washington. The next big vote is on raising the debt ceiling. They will probably vote to raise it, which is the wrong thing to do.

Category:

News & Politics

Tags:

• Peter Schiff
• Treasuries
• Government Bankrupt
• Financial Collapse
• Economic Collapse
• Financial Crisis
• Economic Crisis
• Gold
• Silver
• Dollar
• Federal Reserve
• ron paul
• john stossel
• judge napolitano
• inflation
• hyperinflation
• interest rates
• capitalism
• free markets
• tom woods
• austrian economics
• government shutdown

[omegapointil]

I think you can attribute our problems to Freedom. Too much of it in the wrong hands was like giving a 5 year old (Paulson, Summers, Greenspan, Bush, Cox,

Reagan, Graham) a firearm to play with. Just watchedt the film INside JOb and

it brought back the pervasiveness of just how true that it. We don't need no stinkin

regulations? Shoulda made Brookly Born Czar.

[jajones1952]

@silvermania2011 Try to eat that metal when the shit hits the fan.. Or prevent a strongarm drygulch of your goods powerless one!!! You will live in fear of owning it. Word.

[yaimavol]

There is one saving factor here with re: to our deficit -- everybody else is broke too. Japan is in even worse shape: Greece, Italy, Ireland -- all totally bankrupt. Doesn't it make sense, folks, just to hold an int'l conference and write this debt off? At some point, it just becomes numbers in a computer.

[yaimavol]

@omegapointil Yes, we gave 70 loans to Libya -- a country we are now bombing. There isn't a better illustration of how f'd up this country has become.

[omegapointil]

Well Schiff, we audited the Fed and look at what Rolling Stone found. How is this not racketeering? I'd like to see that term define if for the popular press and

take a hold. That is if it doesn't get repressed. This is the Pentagon Papers.

[flownet07]

This agreement is a small step for the US, but in no way does it stop the lead towards the cliff and the final leap into the abyss... A 38 billion $ cut is only pocket change in regards to the US budget. Severe pain is coming. Politicians and the Fed know it but don't have the balls to proceed and prefer to try to avert it. They'll just manage to postpone it instead. Many are blaming the Fed, but this the result of Congress piling up a debt so HUGE that it defies the imagination. Titanic wreck!

[schimdo]

Good stuff Peter.

[stixin2000]

Pete you ARE and will always be a true American Hero! Thanks for having the guts to tell it how it really is! O and TY for your advice , I have done very well with my silver investment!

[de225221]

Keep up the great work Peter. Anyone w. an IQ of at least 85 can figure out that you're right and have been right for so many years now..

[silvermania2011]

Peter does it matter who your critics are ?? gold is at $1475 silver is at $40.75 we are doing excellent not matter what they say. Your critics are the same people who mocked you in 06' and 07' example: Art Laugher, where is he today?!?! These people will throw you under every chance they have because they are jealous and because they didnt buy any gold or silver and are eating there hearts out.

Keep up the good work Peter and dont even give them any airtime what so ever.