Sunday, July 11, 2010

Peter Schiff & Economic Crisis

7-6-10 Peter Schiff leads a panel discussion with Judge Andrew Napolitano on how to boost the economy. The debt is now overwhelming and is leading to an economic crisis and possibly a deflationary depression. The Obama Stimulus has failed and Keynesianism is a complete failure...

Note: I have a slightly different opinion on our what our economic future holds and feel a hyperinflationary depression (vs a deflationary depression) is the most likely outcome...

Why do I think this way?

Well, the Fiat US Dollar is in a very precarious situation and when we combine Gvt's ZIRP policy and massive monetary printing / backstop efforts (to offset a deflationary economy) with a future loss of international confidence in the world's reserve, the dollar WILL FALL (mid-long term) - causing our cost of living to significantly rise and our standard of living to plummet (precipitously) - ultimately leading to a hyperinflationary depression.

Bottom line: Massive unemployment and collapsing asset prices will combine with much higher energy, food, clothing (etc) costs (driven by the dollar losing value) and US society will eventually become much more local and hand-to mouth... Desperation will ultimately set in for millions of "families" as they reach the end of their ropes.... Relentless jobless, homeless and hopeless future prospects will likely lead the forlorn US citizenry to revolt (As Celente says: those who have lost everything have nothing left to lose) - leading to massive social and political change (with unrest, martial law and a new global war potentially included in the overall mix)...

Social consequences of an economic meltdown

Dollar: Faltering Foundation of US Economic Strength


At 7/12/2010 6:32 AM, Anonymous SPECTRE of Collusion said...

What serves the interests of the power elite because at the end of the day they control it all. You really think they will allow the debtors to pay off all their old loans with an ever cheaper dollar? If they do that, they are cutting off their noses to spite themselves. Who ended up with what during the last Depression?

At 7/12/2010 11:07 AM, Blogger Jb said...

Randy, great post. Your point about the 'loss of international confidence' agrees with my logic as well since it's my understanding that most of the US$ are held overseas. Thus, it's not the loss of AMERICAN confidence that I'm worried about.

The UN is calling for an end to the US$ as the reserve. Meanwhile, the Russians and the Chinese have increased their domestic gold mining operations. According to recent figures, the Saudis have doubled their gold holdings since 2008. Thus, I fear the loss of confidence has arrived and these countries are now executing their plans on a timetable. A race to the exits?

What if the Russians and the Chinese decided to create an eastern European currency backed by gold?

Thanks for the links to older blogs. I hope you will update the 'social consequences' again soon!

At 7/12/2010 2:13 PM, Blogger Jb said...

Randy - you might enjoy listening to Stoneleigh of the Automatic Earth speaking about the correlation between markets and energy:

At 7/14/2010 11:43 PM, Anonymous T Z said...

The end of USD as dominant world reserve is the one true event that will save the US.

How so? It stops the US from irresponsible currency inflation and live within means. Which, of course, is an utterly alien concept in the land of the gun. But if the Brits can do it (give up the empire) then the Yanks can do it too.

At 8/05/2010 1:15 PM, Anonymous Anonymous said...

Forget Schiff. The prominent georgist economists Fred E Foldvary and Fred Harrison predicted the crisis in 1997. What Peter doesent take into account is the real economy (the current crisis was unavoidable under the current socio political arrangement). It's a property crash cycle. The smoking gun is the privatized profits in an inherently unstable the land market.
The business cycle: a Georgist-Austrian synthesis


Post a Comment

Links to this post:

Create a Link

<< Home