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22 Sep, 2020 12:30

United States is broke & the Fed knows it, it’s just blowing more air into asset bubble – Peter Schiff

United States is broke & the Fed knows it, it’s just blowing more air into asset bubble – Peter Schiff

The US Federal Reserve will eventually have to let interest rates rise unless it wants the dollar to become worthless, says veteran stockbroker and CEO of Euro Pacific Capital Peter Schiff.

According to him, one of the most amusing comments the Federal Reserve Chair Jerome Powell made during his last week’s post-meeting news conference was saying that the Fed had to fight low inflation because it could lead to interest rates being too low.

“But he wants low interest rates. They’re already at zero. The Fed’s goal is low interest rates. So, how can the Fed say low inflation is a problem if the only problem that we get from low inflation is low interest rates when he thinks that’s the solution to every problem?”

Schiff pointed out that there are undoubtedly bubbles in the economy and “the Fed knows there’s a bubble because any time the air starts coming out of it, it’s there to blow more into it. I mean all of its policies are deliberately designed to maintain that bubble.”

Also on rt.com US economy in decline under crushing debt & rising power of China – Ray Dalio

The economist added that the irony is that “everything the Fed is doing to inflate asset bubbles is actually deflating real economic growth on Main Street. The Fed is the biggest enemy of legitimate economic growth because it’s so fixated on maintaining these asset bubbles that it now denies exist.”

Schiff said: “We don’t need more infrastructure spending either. We can’t afford that. We’re broke. We don’t want the government creating money and spending it. We want the government to stop spending so that they can free up those resources back to the private sector where they’re needed. Everything the government is doing, all these government spending programs, are making the economy weaker, not stronger.”

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