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Peter Schiff, Euro Pacific Capital CEO and chief global strategist, on U.S. and European debt comparisons, plus the Federal Reserve’s response to th...
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-- investors backing away from gold -- -- -- haven after the Fed chief said he had the tools to -- -- cash into the economy if needed but had no immediate plans to act.
My next guest says the US economy will ultimately get the -- stimulus it's just a matter of time Peter Schiff Euro Pacific Capital CEO cheap.
Global strategist and author of the real crash America's coming bankruptcy joins me now.
Peter it's great see it's the little glass isn't -- opportunity to talk to use it thanks for coming on.
You just heard filter news that her term.
A Triple Crown of stimulus that that that's gotta be outrageous for -- hear.
Well unfortunately we're not gonna -- win any races out with stimulus but.
QE3 is coming I mean if that Ben Bernanke said nothing in that testimony.
To change my opinion on that in fact he validated he said at the US economy needs if he's gonna do what it takes and of course we are going back to recession.
I don't think we really need stimulus but that's all Ben Bernanke knows so.
It is coming.
Winter battery and listen I'm looking at all -- how amazing and cut the economy unfolding.
Then without stimulus.
From here -- without stimulus we're gonna have the recession that we need in order to restructure the economy.
All the stimulus does is prevent that restructuring and so we never have a genuine recovery we just get a stimulus induced high and every time it wears off we need we need more stimulus I had to make -- to maintain a high but here's the one I wanna make.
And this is what really should be the news from what he said.
Jim demand ask a very poignant question to Ben Bernanke may be was reading my book is this is basically that these as of the real crash.
Given that -- said that Ben Bernanke was aiding and abetting congress that he was enabling the big deficits by keeping interest rates artificially low.
But he was luring us into -- trap.
Because eventually interest rates are gonna rise and were not going to be able afford to make the payments on -- national debt.
And then Ben Bernanke basically flat out lied and he was back.
He could even restrain the laughter because it was such a why he basically told given to me not to worry.
That deals not with interest rates could only go up to 1%.
And even if they went all the way up to 1%.
It would only add 800 billion a year to the deficit -- 1% is still artificially low rates that was the lowest rates we got.
Under Greenspan you know 1%.
What about 5% and that's that they're even going higher than that.
But even by the Fed chairman's -- that as 500 billion a year to the cost of financing the deficit that's the fiscal -- Not the fact that we might cut spending a little bit at the end of the year or raise taxes.
The fiscal -- is when interest rates go up we can noble more afford our bonds and then Greece could afford it.
It's that's true -- -- you make a point -- year.
Latest research right that that US kinda -- to pass on that kind of stuff right while Greece doesn't and wearing in a lot of ways and a much tougher fiscal situation in Greece.
All of yeah I heard a commentator make a point earlier this morning saying that hate Greece is actually in much worse shape than we know because if you look at their unfunded liabilities.
They're real debt to GDP.
Is something like 450%.
Well if you look at America's unfunded liabilities our debt to GDP is more than twice as high as Greece's so you know everybody is worried about the debt.
-- -- -- But no one seems to be worried about the debt in America and if you think Ben Bernanke took QE3 off the table yesterday.
Imagine how much money he's gonna have to print.
To keep interest rates at 1% indefinitely because basically that's what Ben Bernanke said he simply don't have to worry about the enormity of the national debt.
Because will be able finance and at 1% in perpetuity so think about that and of course we can't do it because he would destroy the dollar we have runaway inflation.
He would be forced to raise interest rates and then we would have no choice I'll.
But to restructure and the fall.
Another point of view from Peter Schiff thank you so much have a good weekend thank you okay fed chief Ben Bernanke says home.
