Thursday, December 17, 2015

Peter Schiff: Fed's Next Move Will Be More Easing

Here we go again.

“The next recession is about to begin and there's a good chance that it's already here or it will begin early in 2017,”  Peter Schiff told Newsmax TV’s “The Hard Line.”

My view could change, but I currently see no indications of a recession.

“The only reason the Fed is raising rates is to try to show that they have confidence in the economy, but the reality is they have no confidence in the economy and they're trying to cover up those fears with this symbolic rate hike. But they're going to have to figure out how to reverse course unfortunately. They're going to be doing QE4 next year, they're not going to be raising rates again,” Schiff said.

From my perspective, it is not a lock, but more hikes are likely,


 -RW

7 comments:

  1. Between Robert's views and Schiff's views and Stockman's views there is plenty of opportunity to eat popcorn. Might be some crow thrown in as well. But for whom? Robert has called it pretty well so far, I think.

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  2. Mish Shedlock is good too. They hiked over a period of several years before the SHTF last time. It seems like Japan would hit the wall first.

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  3. Robert how can you not look at manufacturing and bulk dry shipping and every single commodity and retail sales and not think recession hasn't begun?

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    1. Retail sales are at a record high. Manufacturing Business Outlook Survey shows expansion in November. Baltic Dry Index is low due to investment in shipping when the index was going through the roof. Oil is low due to investment when oil was going through the roof. No recession.

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  4. "Here we go again"??

    Haha, he was right back in Sept and you were wrong. Quit acting like you area always in the right please.

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  5. Part of the problem Schiff has is he gives the Fed too much credit. They don't KNOW that all they created is a manipulated economic boom created by their money printing. They actually BELIEVE they are fixing the economy with their goldilocks money printing. Case in point is the fact that nobody at the Fed seems to care about money supply growth anymore. That's why they will keep hiking rates until the bottom drops out.

    The one area I might disagree with RW on is that I'm not convinced the Fed is going be printing enough money now to support the current economic structure. The money supply growth has not been accelerating on a yearly basis, in fact for the last 3 years the money supply has been growing at an average of about 5.8% per year. That's a far cry from 7.4% in 2012 and 9.7% in 2011. Certainly the money supply is growing, but is it growing fast enough to feed the bubbles in the debt-fueled markets? And will money supply growth slow down even further now that the Fed is raising rates? Tune in next time...

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    1. You're overlooking the fact that inflation is very low. You're stuck in a bad model which defines inflation as merely growth in the money supply. Fact is money supply growth is related to output, prices and velocity. Low inflation requires less growth in the money supply. Inflation was 3% in 2011. Today it's zero.

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