Peter Schiff: "We're Near The Endgame... And Trump's Gonna Be The Fall Guy"

Authored by Mac Slavo via SHTFplan.com,

Peter Schiff isn’t known for mincing words or sugarcoating the evidence.  The financial broker and economist said in an interview “the economy is going to blow up like a bomb,” and when that happens, Donald Trump will take all of the blame.

https://www.zerohedge.com/sites/default/files/inline-images/20180123_schiff.jpg

Not even a full minute into an interview with Alex Jones of Info Wars, Schiff says “it’s not a good thing” that the economy is going to crash and burn. “Unfortunately, that’s what Trump has inherited from Obama. But it’s not even really just Obama, it’s the federal reserve. It’s the monetary policy that has been passed like a baton from Clinton to Bush to Obama and now to Trump. And we’re near the end of the game and unfortunately, Trump’s gonna be the fall guy.  This thing is all gonna collapse while he’s president.

The tax cuts will give Democrats a reason to blame the collapse all on the Republicans, says Schiff.And we are getting close to this collapse.

“The important thing, is if you look at what’s happening in the dollar, for example, last year was the first year in five years that the dollar went down and it was the biggest decline in 14 years. We has the biggest drop against the Chinese Yuan in nine years, and in fact, I think this year we’re gonna fall to an all time record low against the Yuan. I think we’re gonna hit record lows against other major currencies like Euro and the Yen maybe by 2019 or 2020.”

Jones then asks Schiff what Trump is supposed to do to stop the crash. Schiff says there’s nothing he can do.  It’s set up to crash so the United States will end up with a left-of-socialist dictator such as Bernie Sanders as the next president.

“He [Trump] campaigned and said it [the stock market] was a bubble. It wasn’t his bubble.  Now it’s his bubble; that’s the problem. But if he would have said ‘it’s a bubble and it’s going down,’ it wouldn’t have been his fault.  Because part of the cure for the economy is deflating these bubbles. It has to be done. Someone has to rip this bandaid off and he was elected to do it.”

Jones then asks Shiff to walk him through what an economic implosion would look like.

“Here’s how it’s gonna go down. So, what’s gonna happen is interest rates are gonna keep rising, commodity prices are gonna keep rising, the dollar’s gonna keep falling, so you’re gonna start to see pick-ups in the official inflation rate. And so, rising consumer prices and rising interest rates are gonna start to be a powerful headwind for the economy because Americans are gonna be spending a lot more money on basic necessities, if they have an adjustable rate mortgage…costs are going up. Credit card debt, auto loans, all this cheap money is gonna be gradually going away and the economy is going to be weakening. And as the economy is weakening, unemployment is gonna start to pick up. Now the Fed is gonna see this. The Fed is gonna see the economy slowing down, and if they continue to raise rates, it will go into recession. Now, that’s better than the alternative.

But, the alternative, if the Federal Reserve decides that they want to prevent a recession or maybe fight off a recession if it happens and they don’t recognize it in time, if they wanna prop up the stock market, then what they have to do is call off the rate hikes.  In fact, I think that they have to go back to zero, they have to launch QE4 in order to keep interest rates from really spiking and to prop up the market, but that will set off a currency crisis. The dollar will plunge, not just make new lows. That will set of an economic crisis that’s far worse than the financial crisis or the recession that we are trying to avoid.”

Schiff then says the problem is also unfunded liabilities such as social security and Medicare.  He says that China doesn’t have any of those.  The Chinese rely on themselves, have disposable income, and save 30% of their income and taxes are almost nothing to keep businesses booming.  While Americans pay a lot of taxes, save only 3%, live paycheck to paycheck, and rely on the deeply indebted government. Becoming self-reliant and preparing yourself for this crash will give you a hand up in during the dollar’s collapse.

Jones then stated that “betting against America,” wasn’t a good idea.  But Schiff fired back.

I’m not betting against America. I’m betting against the socialists and central bankers who have destroyed America. In the long run, maybe America’s gonna come back. But first, we’re gonn have to pay the piper.”

Comments

andypaps28 Jan 23, 2018 5:15 PM Permalink

The S&P gained 21% in Trump's first year to reach 2591, today it closed at 2839. Basically the S&P needs to lose a third of its value to get us back to when Trump came to power.  There will be a financial crisis at some point. However like Zimbabwe when their currency fell to being worthless and inflation at 1000%s their stock market increased 25 fold. The S&P is priced in dollars so when the dollar collapses the S&P will be multitudes higher in nominal terms. 

As an aside crypto currencies are so high because negative bearing treasuries are valued at 7 Trillion ; that money will all eventually find a home in risk assets including stocks.

I used to like Peter Schiff but he's becoming boring as he just talks his book.

 

 

coast1 Jan 23, 2018 5:10 PM Permalink

I brought this up yestereday, did not get much attention except someone saying alex has to be a bull for ratings...I sometimes wonder if writer(s) here at ZH just read comments and then if they find a good one they write about it on an article...Should we not get royalties?  :-)  j/k   I bet there are a few here tho that post a comment and find your comment somewhat in an article the next day

MusicIsYou Jan 23, 2018 5:10 PM Permalink

Wow, really? There's a handful of us Americans who aren't blind drooling idiots. It sucks to be you folks who had a Trump sign in your yard because your house is probably gonna get burned down.

Hongcha Jan 23, 2018 5:06 PM Permalink

The Chinese paid with a 1984-style totalitarian technocratic government, pure fascism. And paid by having their environment destroyed due to no regulation / enforcement. 

Davidduke2000 Jan 23, 2018 5:04 PM Permalink

I saw it yesterday and Jones flipped out when Peter told him the economy is not the stock market, all these highs are artificial.

But Peter realized jones is a cheerleader for trump, he immediately put the entire blame on the us central bank.

Peter is right on with his assessment of the situation. 

Betrayed Jan 23, 2018 5:03 PM Permalink

Not a Schiff fan. But what he states makes sense in that if Trump is a Trojan Horse who's role is to divide and weaken the conservative populist movement of which I personally believe he is.  I cant think of a better way to destroy the momentum they had in 2016 and make way for the reset. By the way don't be surprised if Trumpenstein gives in to DACA next month for a Wall that won't work.

GotGalt Jan 23, 2018 5:02 PM Permalink

Sorry Peter Schiff but Japan CB has been keeping pedal to metal with their QE and manipulation of *everything*, and Yen is not imploding.  Why?  Likely due to G20 agreement where all parties are committed to keeping various currency pairs within a strict zone so that the never ending monetary insanities can/will continue unabated.

honest injun Jan 23, 2018 4:59 PM Permalink

Everybody knows the music is going to stop.  When is difficult to predict.  Trump must have an idea of when and probably has a plan like the Saudi king did: arresting the Rothschilds, Rockefeller, Soros, ...  confiscating their assets.

johand inmywallet Jan 23, 2018 4:58 PM Permalink

One of these days he will be right. I believe the forces in place in the .gov and business world that hate Trump would be very happy to burst the bubbles in order to get rid of him in 2020, unfortunately this bursting and collapse is going to be uncontrollable and who knows where the bottom will be. A lot of money is going to be lost and a lot of lives will be also.

Grandad Grumps Jan 23, 2018 4:57 PM Permalink

Never been a fan of Schiff. He is a parasite who sucks up to corrupt money and thinks more highly of himself than he should.

I originally thought Trump was put into office to take the fall ... and he agreed to it (maybe because he thought it would be a challenge or he was put in that spot by God). I no longer think that. Anyone who knows how the system works, knows that Trump is not the fall guy. If and when things collapse, the word will quickly get around as to who is really responsible and if Trump is still alive and in off, he will have their asses.

Looking forward to the SotU. I have never watched one before.

Stan522 Jan 23, 2018 4:53 PM Permalink

Schiff... you've been saying that during the entire obama 2 terms and now the same thing during Trump.....

I'm convinced it will eventually happen, but this is getting old.... Why now?

Yen Cross alangreedspank Jan 23, 2018 4:57 PM Permalink

  Traders are borrowing the euro instead of the $usd for the carry trade. The euro rates are zero and the $usd funding costs are 1.5%.  As soon as the the markets start tanking, or rates move much higher, traders will want $usd and treasuries, for the yield.

  The ECB is the ones fucking things up, because they're still printing like crazy, and have a PUT under euro area bonds. All that hot money going to the banks is being lent at zero% interest.

  February isn't going to be anything like January.

In reply to by alangreedspank

Two Theives an… Jan 23, 2018 4:50 PM Permalink

I like Schiff. He and Stockman are "classic" economists and in time they will be proven right. However he always underestimates the substantial ability of the banksters to discreetly prop up the system.

Who bought all those bonds today Peter? Hmmmmm? 

Pumpkin Jan 23, 2018 4:49 PM Permalink

I hope Trump is ready to take one from the dems playbook on this and not let a crisis go to waste.  Put ever complicit fed and bank exec in jail.  Including every regulator that seen a book.

Dutch1206 Chipped ham Jan 23, 2018 5:09 PM Permalink

Except he made a pretty massive error in taking complete credit for the past years run up in the S&P, increases in GDP, and jobs coming back.  With respect to the stock market he was 100% correct in 2016 when he said it was a bubble.  Unfortunately his ego barely fits on this planet and he walked back from that and started patting himself on the back.  He basically set himself up to take the fall for this.  Sometimes it pays to be humble.

In reply to by Chipped ham

Baron von Bud Davidduke2000 Jan 23, 2018 5:13 PM Permalink

Schiff is a straight shooter though maybe not a great money manager. I like the guy. Here's the thing, David. The US and China have one thing in common. Both are gas bags of fiat masquerading as real economies. The US economy is nothing without our massive military spending. We spend on useless ships, fighters that can't fight, and more admirals than we have ships. China just builds useless crap and calls it growth.

In reply to by Davidduke2000