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Schiff: Economy Experiencing Stimulus Hangover

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  • Description

    Euro Pacific Capital president Peter Schiff weighs in on the state of the economy.

  • Duration 3:44
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The US economy unexpectedly -- negative last quarter contracting for the first time.

In three and a half years the markets shrugging it off with Peter Schiff.

Doing about it he is president of -- Pacific happen all.

Peter good to see if you what the ten year treasury yield is about 2% the markets barely -- -- off.

Investors seem to be saying this is fleeting we shouldn't worry what say you.

Well they they need to worry you know it's interstate -- the last quarter of the Obama term is the weakest of his presidency yet to go back -- the first quarter of his first I mean of the first the hearing was in office.

But it shows me that the -- temporary euphoria of the stimulus is wearing off.

The hangover is setting in.

You know and as bad as things were during the Obama recovery way do you see how bad it's gonna get during the Obama recession and I think the Fed of course getting ready to -- the up the dosage of the stimulus.

A lot of people were thinking that the Fed was gonna -- take away the money yard to stop the stimulus they're not gonna do what they're could have stopped the notion because 85 billion dollars worth the money printing.

Isn't enough that's how addicted we art -- is cheap money.

Interest rates are rising despite this.

And the dollar's tanking and it wasn't for the Japanese yen if they weren't trying to act even more recklessly I imagine how low the dollar would be but I think it's gonna break down a lot that's gonna send oil prices look at oil prices knocking on the door of a hundred dollars a barrel as oil prices rise of dollars thanks.

More people are gonna realize that this economy is -- a lot worse shape than they thought.

Why isn't oil high because the economy's in better shape why are yields going up because the economy's in better shape and it must be on it -- -- up.

I mean you're there are brought up look at what -- -- water they're gonna not wire people -- wire people selling treasury bonds.

If there are a -- worried about the economy they're not they're feeling a little bit more comfortable with this why that they don't sell bonds and buy stocks.

No I think they're they are worried look.

ED zero -- European.

Situation is now defusing a lot of money was fleeing the Euro.

Now -- going back to the Euro zone and some people are buying euros they're selling dollars and I think more people are starting to recognize.

That the dollar is going to lose value so why would you want to own treasuries.

If the dollar's going down meanwhile a lot of foreign markets are doing much better than it did the US look at some of the emerging markets look at southeast Asia I don't necessarily think people need to be -- US stocks I think -- a lot better opportunities abroad.

One last thing that if you look at -- you're talking about the Federal Reserve Peter.

Do you worry about the Federal Reserve -- suddenly we got a decision this afternoon suddenly pulling the plug on this stimulus.

If the Fed starts to get worried about the dollar to the dollar's depreciation -- the Fed starts to worry about inflation.

Well they're not gonna do that they shouldn't do that they should pull the plug on the stimulus we need higher interest rates we need to have a real restructuring we need a real recession so we can have a real recovery unfortunately the Fed's not gonna stop printing until they turn the country in degrees until we have all out dollar crisis until we have a sovereign debt crisis they're gonna keep depresses rolling they -- -- keep the economy -- as a -- They don't want people sobering up to the reality that the problems are now worse than they -- in 2008 did everything the Fed is done.

Has helped make the problem worse it's prevented the economy from restructuring along level allied that we can actually have illegitimate recovery instead we have the illusion of recovery but that -- -- -- I like -- -- Tommy I'll look good any day of the week Peter thank you Peter should have.

May well we'll get a job would be that would be illusions -- -- thank you for the compliment would tell us hunting for -- by the -- you're welcome back tomorrow here's --

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