Sunday, September 28, 2014

Blind faith in dollar will lead world to financial Armageddon – PeterSchiff

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Blind faith in dollar will lead world to financial Armageddon - @PeterSchiff to @SophieCo_RT 


This year has seen plenty of political turmoil – the waves of instability seem to do little to the world’s economy. Will that remain so for long? And if not – is there an another crisis looming, like the one that left thousands if not millions helpless and in poverty in 2008? And, finally, what does tomorrow hold for dollar? We ask these questions to leading financial analyst and CEO of Euro Pacific Capital. Peter Schiff is on Sophie&Co today.
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Sophie Shevardnadze: Peter Schiff, leading financial analyst, CEO of Euro Pacific Capital, welcome to the program, great to have you with us. Now, you’ve said it’s not global turmoil, but the Federal Reserve that’s causing damage to investors and the U.S. economy. How so?
Peter Schiff:Well, right now, a lot of people don’t appreciate how much damage the Federal Reserve is actually doing, because there’s a lot of false optimism right now regarding the success of the Federal Reserve’s QE program, and its 0% interest rates. People believe that it’s been successful at reviving the U.S. economy, and that’s why there’s some interest in the dollar in our markets – but all what Fed has succeeded in doing is exacerbating all of the problems that caused the 2008 financial crisis and they’ve inflated a much bigger bubble – so I think the crisis that we have coming is unfortunately going to be much worse that the one we passed.
SS: But if you look at all the geopolitical turmoil across the world, you have the crisis in Ukraine, you have the Middle East, you have ISIS – it does seem that to a large extent the markets are shrugging it all off too – why is that?
PS: I think a lot of people are delusional. They believe in this false narrative, they have confidence in what the Federal Reserve has done, the believe the forecasts of many of the economists about vibrant growth in the U.S. economy in years ahead, and of how Fed will raise interest rates, and the economy continues to expand. All that is impossible. The Federal Reserve has placed itself into position where they can never raise any interest rates – in fact, I don’t think they’re going to be able to go very long without launching another round of quantitative easing, because our bubble economy is completely dependant on the continuation of that policy. When the Fed takes it away, we’re headed for a massive economic collapse.
SS: So just let me clarify: are you saying that the worst is still to come? Is that your prediction?
PS: Why, absolutely. We haven’t solved any of the problems that led to the 2008 financial crisis. In fact, all those problems are now larger than ever, because of what the Fed did. The Fed interfered and prevented the market from solving the problems that years of bad monetary policy created. As a result, those problems are bigger and the crisis looms larger than ever.

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