Wednesday, March 10, 2010

In Profile: Peter Schiff

By Mark Pazniokas

The two worlds of Peter Schiff merged over the weekend at a Holiday Inn hard by I-91, where he pitched investment advice and his U.S. Senate candidacy to Tea Party activists.

Schiff covered subjects never broached in last week's tepid debate with two rivals for the Republican nomination, things like the merits of burying gold vs. stashing it off shore.

He was invited to give two talks, one on his candidacy and the other on how to use gold as a hedge against an economic collapse that he has been predicting since 2007.

Over three hours, Schiff seamlessly mixed business and politics, telling his audience some things it wanted to hear and a few it didn't.
schiff, peter, 3-8-10

Republican U.S. Senate candidate Peter Schiff speaks to Tea Party activists

"Nobody in Washington thinks I can get elected," said a smiling Schiff, who preaches cutting Social Security, Medicare and unemployment benefits. "I have stepped on every political third rail that exists."

And then some.

Schiff is the president of the Westport brokerage firm, Euro Pacific Capital, and a frequent commentator on CNBC, CNN, Fox and Bloomberg known as "Dr. Doom" for his apocalyptic views of the U.S. economy.

He claims credit for calling the 2008 recession on the air and in print. In early 2007, he published, "Crash Proof: How to Profit from the Coming Economic Collapse."

But here's the thing: The 2008 recession is not the collapse he is talking about. If one considers Schiff a financial evangelist, then think in biblical terms of what he sees in store for the U.S. economy.

Schiff sees the U.S. economy unraveling. The debt is unsustainable, made tolerable for the moment only by interest rates kept artificially low by a meddling central bank, the Federal Reserve.

He likens the government's fiscal and monetary policies to a Ponzi scheme, destined to collapse when when China and other foreign lenders finally cut off credit.

"At some point, they are going to look at the U.S. and decide we can't pay it back," he said.

The dollar will crash. Interest rates will rise, fueling inflation that could leave currency worthless. And that's where the gold comes in.

"You have to have real money, gold and silver," Schiff said.

It was unclear if Schiff found the right demographic at the Holiday Inn for his pitch about gold or his candidacy. Organizers had to pass the hat to offset the $650 cost of the conference room, and not even Tea Party leaders like predicting where the movement's activists will show up on election day.

Tanya Bachand, one of the organizers, said she likes Schiff's economic message, but a significant portion of the movement are opposed to abortion.

"He's pro-choice, and that's difficult," she said.

Monique Thomas of Greenwich said abortion opponents are unlikely to find an ally who is a serious challenger in the mix. At some point, being against the status quo is not enough.

“You have to choose someone else,” she said.

Palin Smith of Woodbury was one of the audience members who has found it easier to oppose incumbents. He introduced himself as the originator of a dump Chris Dodd web site. With Dodd out and Richard Blumenthal in the race, Smith has shifted gears, printing buttons that say, "No Blumen Way."

He has no pro-Schiff buttons, but he may get there, Smith said.

"I like him," he said.

Read the rest here.

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