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Euro Pacific Capital’s Peter Schiff on Fast Money, November 20, 2008. “Capitulation is probably the most over utilized word on CNBC. I hear it every day for months. I think capitulation, if we get it, is years away. Our markets are going lower. This isn’t just a financial crises, this is an economic collapse.”

Last week, the government announced a program that will substantially lower payments for many homeowners who have little or no equity, but only if they are at least 90 days delinquent. Peter Schiff, president of Euro Pacific Capital, predicts that many homeowners who have little or no equity will stop paying their mortgage and then reduce their income to get the biggest payment cut possible. They could stop working overtime or, if two spouses work, one could quit. After the modification, they could try to boost their income again. “This is a once-in-a-lifetime opportunity,” Schiff says. “People are going to feel like complete morons if they don’t participate. The people getting punished are the ones who never made an irresponsible decision to buy a house they couldn’t afford.” More

Thanks To Credit Writedowns for this Video find. This is a set of Peter Schiff clips (predictions) from 2006 and 2007 edited by jdouce. This whole nation is in complete denial. Some homeowners continue to believe the value of their homes are rising; financial talk show hosts like CNBC’s Erin Burnett believe gold only has value because people believe it has value. This is the kind of mindset that permeates America, where NASCAR, Porno, and beer anesthetize the masses. When Americans, paralyzed by shock, awake, they’ll be living in a collective nightmare.

Truth: the most deadly weapon ever discovered by humanity. Capable of destroying entire perceptual sets, cultures, and realities. Outlawed by all governments everywhere. Possession is normally punishable by death.– John Gilmore

CNBC debate regarding the consequences of allowing US Automakers to fail. CNBC’s Phil Lebeau and Steve Liesman are shameless mouthpieces for GM and all things government with an irritating flair for smug arrogance. I long ago dismissed the fact that either one of them were paid propaganda agents lying about the truth; no one can act that well. Both of them clearly believe the stupidity they spout. Rick Santini and sometimes Mark Haines (not included in this video) are the only members of the CNBC Muppets that see the truth. In this video, Peter Schiff stuns Phil Lebaue by telling him Americans are no longer buying cars. Lebaue incredulously replies, “Americans aren’t buy cars? Are you crazy?” Lebeau is clueless. In fact both Steve Liesman and Phil Lebeau could meet the description of Parsons, a character in George Orwell’s Novel, 1984:

“Parsons was Winston’s fellow employee at the Ministry of Truth. He was a fattish but active man of paralyzing stupidity, a mass of imbecile enthusiasms– one of those completely unquestioning, devoted drudges on whom, more even than on the thought police, the stability of the Party depended.”

Steve Watson
Infowars.net
In an incredulous display of ignorance symptomatic of the underlying causes of the financial crisis, CNBC anchors laughed their way through an interview with respected economist Peter Schiff yesterday as he attempted to explain how an Obama presidency would negatively impact the U.S. economy. Erin Burnett and Mark Haines of CNBC’s Squawk on The Street persistently interrupted Schiff, CEO of Euro Pacific Capital, barely allowing him to finish sentences or even complete thoughts as he sought to explain how ‘Obamanomics’ will not address the problems at the core of the crisis and will instead perpetuate them….

Schiff has repeatedly warned that America is on the brink of a long and deep recession, the root causes of which are continually being touted as solutions by both Presidential candidates….Schiff is well respected amongst the major financial publications, primarily due to the fact that almost three years ago he accurately forecast that the U.S. housing market was a bubble that would soon come to bust, and also that the crisis would extend to the credit lending industry.

Perhaps if more people had listened to voices like his several years ago, instead of laughing at them, which as we have seen is still the case, then the economy would not be in such a dire mess today and we may have a presidential candidate who speaks of enacting change and actually means it. Instead the so called free world is today lumbered with a choice of endorsing a phony messiah or a dead duck, both representative of the fortified and irradicable Washington elite punch and judy show. More

Also see: Will Obama “Change” The Bush Police State Or Expand It?

Peter Schiff; President & Chief Global Strategist of Euro Pacific Capital discusses the economy under a Barack Obama Administration. “When he [Obama] comes into office it’s going to be as if capitalism is repudiated. The new mandate is we need more government….He’s going to try and revive the bubble economy. He’s going to try to get Americans to spend money and borrow again, and that’s the disease not the cure….We’re setting up a collapse in our currency…There’s a major crises coming. This is only the beginning.”

Towards the end of the video (7:16), pay particular attention to the sheer idiocy of the comments made by Mark Haines and Erin Burnett. Erin Burnett makes the astounding claim that “gold has no inherent value like oil which does. ROLMAO!

She goes on: “Gold only has value is so far as I want to believe it has value.”
Peter Schiff: “No, you’ve got it backwards, that’s fiat money. The dollar has no value except perception. Gold has real Value.”
Erin Burnett: “In this…all that has value is food and oil.”
Peter Schiff: “No, gold has value.”
Erin Burnett: “This is a fun conversation.”
Mark Haines: “He’s [Peter Schiff] provocative if nothing else.”

I had previously believed mainstream news pundits were collusive in spreading government propaganda. Now I understand many of them actually believe the propaganda. (They must be the Aliens, those “We are from France” people everybody’s been talking about.) Think of how profoundly disturbing the implications are: These talking heads are so believable to the uninformed public because they themselves believe the lies and propaganda.

Financial Post
Peter D. Schiff, an extreme bear who correctly foresaw the U.S. stock-market slide, the home mortgage meltdown and the credit crunch, still sees plenty of doom and gloom ahead. As president of Euro-Pacific Capital, a Connecticut-based brokerage, the 43-year old financial advisor has long been urging his clients to get their money out of U.S. stock and bond markets and look for safer investments outside of America or put their nest eggs into silver and gold.

Mr. Schiff, a frequent pundit on U.S. business channels whose gloomy views have earned him the nickname “Dr. Doom,” sees no need to alter that strategy. He expects a lot more downside, despite the already precipitous drop in U.S. stocks, which has seen the Dow Jones Industrial Average tumble 40% from its October 2007 record of 14,164 to 8,379 points as of Friday’s close.

Far from fixing the problem, the US$700-billion Wall Street bailout and other government interventions are only going to prolong the pain, predicts Mr. Schiff, who was economic advisor for libertarian Ron Paul’s 2008 presidential campaign.

The economy, he says, appears headed for its first depression since the Dirty Thirties. Mr. Schiff spoke with the Financial Post’s Janet Whitman.

FP: How did the U.S. get into this mess?

Peter Schiff: It was the result of reckless monetary policies. Of course, the rest of the world is not blameless. They’re the ones who loaned us all the money that we spent. We couldn’t have dug ourselves into this gigantic hole without them. We’ve printed and spent and borrowed our way into a financial disaster. What we are witnessing is the consequences of the excesses of our economy, especially over the past eight years since the bursting of the tech bubble. We basically ended up with false economic growth. Ultimately, if an economy lives by credit, it dies by credit. When we can’t borrow any more, it implodes. A lot of companies were built around this phony economy. Americans are now too broke to buy those products. We never could afford to pay for them. We were paying for them with debt.

FP: Are government bailouts helping?

PS: Everything that the government is doing right now is designed to prevent the market from administering its tough medicine. All of the bailouts are a bad idea. The government is trying to put more cash out there so Americans can keep spending. We don’t need more loans for consumers. We need less. Consumers should not be borrowing. They should be doing the opposite. We’re trying to encourage more of the behavior that’s behind the problem.

FP: What is the solution then?

PS: What we need is real change. We need to rein in the government and let lose the free market, unfettered by government. It was government intervention that created this crisis in the first place. The Federal Reserve brought interest rates down and provided all this cheap money for everyone to speculate with. A lot of Americans refinanced and took out much bigger mortgages in the last few years. The idea was, You don’t want to leave all of that equity in your house. You’re rich now, you live in half million-dollar house. You need a media room and a Mercedes. You can’t be driving that Ford. Everybody was spending all that money like they were entitled to it. Now all the debt is still there and we can’t pay it back. We can’t fix the problem. We can’t stop housing prices from falling because they are too high. Most people still think that the government can fix it and put it back together the way it was. But we need housing prices to fall to a point where Americans can afford them – where you can put 20% down and have a mortgage payment that’s only 25% of your income. I think real estate in America is going to be the cheapest it’s ever been in real terms. Pendulums don’t stop in the center. They swing in the other direction and over shift. More

Peter Schiff: major move coming — Dollar Collapse

Peter Schiff:

“The major move that’s coming with the dollar and gold is way up in gold and way down in the dollar. All the economic growth that we had since the bursting of the tech bubble was phony. All we did is borrow trillions of dollars from the rest of the world, we blew the money on consumption, and now all those Greenspan chickens are coming home to roost….The problem is that we borrowed and spent all that money is the first place and we never would have done it were it not for the most irresponsible monetary policy in US history.

“What’s actually happening right now is the world is basically realigning itself. The global economy has been the function of the world saving and producing the America borrowing and spending, but now we’re too broke to pay back the money; we have nothing to show for all our borrowing because we spent it, and this is causing a lot of angst around the world — when you loan somebody money and they can’t pay you back there’s a problem. But the credit crises is real and it can’t be solved by the government printing money. The credit is gone because the savings is gone. What the market is trying to do is bring about a badly needed recession, trying to get Americans to stop spending and start saving their money again, but the government is resisting it, and the reason the dollar is gonna fall through the floor is because the trillions of dollars the government is trying to create to try and replace all the savings that we don’t have is very negative for the dollar. And once this market noise is over, foreigners are not going to bu our currency, they’re not going to buy our bonds, the only buyers are going to be the FED.”

Rick Santelli, the only guy on CNBC who has any sense of reality and vision responds:

“Peter’s on to something that I really agree with, that the end game here is that all of these countries recycling our dollars back to support our current account deficit, our trade deficit, even our budget deficit, that once the realignment of the euro and the pound is done, they aren’t going to do that, so I agree with him. There’s gotta be a major higher interest rate environment around the globe when they stop supporting each other’s debt habits.”

Peter Schiff on Glenn Beck: Hyper-Inflation and Martial Law

Peter Schiff and Glenn Beck discuss hyper-inflation and Martial Law.

Peter Schiff: “I think when they [BoA] saw Lehman go under without a bailout, I think they realized that the same fate awaits them, and they figured why not just buy Merrill, we’ll get so big they’ll [the Government] have to bail us out. And I think Merrill probably saw the same writing on the wall, they know there gonna go under, and they figured why not agree to get acquired of BoA, at least this way we’ll be so enormous, that maybe they’ll bail us out.”

Source: Dateline
Interview Producer/Researcher
JANE WORTHINGTON
See Video
George Negus speaks with Dr Doom - author and president of Euro Pacific Capital Inc - Peter Schiff and Professor Steve Keen about America’s failing housing market. This week Dateline asks the pair what caused this week’s turn of events and what are the implications for the Australian economy. On Monday, Treasury Secretary Henry Paulson announced the US regulator was seizing control of the government-chartered, shareholder-owned firms underpinning trillions of dollars of home loans and a global financial imprint. The move constitutes a massive government intervention to contain the damage from the worst housing slump in decades, which has rippled through the banking system and led to multibillion-dollar losses for Fannie and Freddie.

New chief executives have been installed as part of the action that Mr Paulson said was needed in view of “the inherent conflict and flawed business model” embedded in the structures of the two companies. Departing CEOs Dan Mudd of Fannie Mae and Dick Syron of Freddie Mac “have agreed to stay on for a period to help with the transition,” Mr Paulson says. The announcement came ahead of the opening of financial markets in Asia and amid ongoing turmoil in markets in response to the housing and finance crisis.

TRANSCRIPT
Fannie Mae and Freddie Mac, they’ve got to be the two most cartoon names in corporate history, but the US Treasury clearly believes their fall to earth last week could send a wrecking ball through the entire global financial system. Now, the unprecedented move to bail out Fred and Fan has been labelled “the most dramatic market intervention in decades”. In one swift, gigantic gamble, the government - well, the American taxpayer, really - has taken on an unimaginable $5.4 trillion in potential home loan liabilities - equivalent to the entire US federal debt. Will it work? And what are the repercussions for not just the US economy but indeed world money markets in general, including backyards here in Australia?

Earlier, George Negus spoke from Connecticut with Peter Schiff, a leading share broker - regarded in the US as a doomsayer - and Steven Keen, Associate Professor of Economics and Finance at the University of Western Sydney, a long-time critic of what he sees as this country’s addiction to debt.

GEORGE NEGUS: Thanks for joining us to talk about Fannie Mae and Freddie Mac. Peter, can I start with you? Is this capitalism in crisis, because you’ve been howling for quite some time that this could be the beginning of the end of the Western capitalist system as we know it, including the American economy and all that goes with it.

PETER SCHIFF, ANALYST AND BROKER, EURO PACIFIC CAPITAL: It’s really socialism in crisis, because that’s what we have. Remember, the reason we had the problem with Freddie and Fannie was because of the implicit government guarantee. If the government wasn’t guaranteeing their debt, they never would have been allowed to borrow so much money, so basically what happened was you had American citizens were basically able to buy houses, not on their own credit, but on the credit of the US Government. And we had this huge bubble that was inflated that never would have been inflated had we been on a free market economy.

The two biggest creators of the mortgage bubble were the Federal Reserve, which kept interest rates too low, which is a creature of government, not the free market, and Freddie and Fannie, which again were created by government. Absent government in a free market economy, none of these misallocations of resources ever would have taken place.

GEORGE NEGUS: So at this point you’re not surprised at what’s happened in the last few days, this so-called bail-out, these so-called conservatorship which is in place, which sounds like a fancy word for bankruptcy to me - you’re not surprised by what happened?

PETER SCHIFF: I had been forecasting the bankruptcy for Freddie and Fannie for years. I wrote about it in my book ‘Crash-proof’, which came out in early 2007. I always said the stocks we going to zero, that they would go bankrupt. Now Paulson is try to pretend that this conservatorship is not going to cost US taxpayers any money because there’s a guarantee. There’s no guarantee at all. All that happens is that if Fannie and Freddie ever have any profits in the future the US Government is the head of common shareholders to receive those profits. But there aren’t going to be any profits. There’s going to be hundreds of billions of dollars, maybe even over $1 trillion of losses. And they’re going to be borne, not just by the US taxpayer, but by anyone anywhere in the world who’s unfortunate enough to own US dollars.

GEORGE NEGUS: I have to admit I’m finding it difficult to get my mind around something called Freddie and Fannie being so important to the world’s economy. You mention the fact there’s this international flow-on. Steve Keen what about this country? Do you think Australians are going to suffer? They’re saying in America everybody will be hurt by this. Does that include Australia?

PROFESSOR STEVEN KEEN, ECONOMIST, UNIVERSITY OF WESTERN SYDNEY: It does include Australia and it’s not just Australia that’s suffering courtesy of America. We have our own bubble over here. And we don’t have anything like Fannie and Freddie to explain why we have got a bubble, so it’s something which I think goes beyond market socialism. It’s actually built into the nature of a financial system that encourages speculation.

The scale of this bubble is twice as big as any previous bubble back when we did have an unregulated financial system, so if you look at the level of debt America got itself into in the Great Depression that was bad enough to cause the biggest economic catastrophe in history. We now have twice as much debt as we had back then. And I think what has happened with the Fannies and Freddies and the US Federal Reserve, it encouraged the financial system to go to twice the level of speculation it would have done without them being there, and that’s what I really see is the contribution they have made.

PETER SCHIFF: Also, when you’re talking about all the problems around the world, remember, the global problems are the result of America borrowing so much money and not being able to pay it back. The credit crunch is that we’ve being borrowing money - hundred of billions, trillions of dollars from the rest of the world - and now the world is finally beginning to realise that we’re not good for the money. We can’t pay it back because we have been borrowing to consume. Nobody has loaned us money to build factories, to build infrastructure. We have nothing to show for the trillions of dollars the world has loaned us except empty houses, plasma TVs, SUVS. We’ve blown the money on consumption and this is the problem. Ultimately the solution for the rest of the world is to stop lending us money, let the dollar collapse, let the US economy implode, and the rest of the world just goes about its business.

GEORGE NEGUS: Peter, that must be heresy to so many people in America, to suggest that the so-called the strongest and biggest economy in the world is to blame for this.

PETER SCHIFF: Our economy is no sounder than a dotcom stock was or a subprime mortgage. It’s all an illusion. We’re flooding the world with our IOUs. We are borrowing from everybody in the world and we’re sucking up resources and consumer goods that we can’t afford.

GEORGE NEGUS: Steve Keen, Peter is actually living up to his name as ‘Dr Doom’, a doomsayer, but is the picture is bleak as Peter is painting it?

PROFESSOR STEVEN KEEN: I think his nickname is ‘Dr Gloom’ and it’s not quite as bad as Dr Doom but, yes, the picture is in that direction. I certainly think that the idea that America has been living on IOUs is valid. Part of the American arrogance and the end of Second World War was to say we are the biggest, toughest, strongest country on the planet. You’re going to use American dollars for international exchange. What that meant was when other countries ran out of American dollars when there are running a trade deficit, particularly back when exchange rates were fixed, there were forced to devalue. They had to do something serious. When America ran out of American dollars, it printed more.

GEORGE NEGUS: So we don’t sound like a mutual admiration society here, what’s the solution than? If you guys are both convinced the Americans have created their own problem and now it’s flowing on to the rest of us, including Australia, Steve, what should they be doing?

PETER SCHIFF: I think the solution - the world needs to recognise that America is not the engine of the global economy. We are the caboose. Anybody can consume. Little children can consume. The key is to produce. The key is to save, not to borrow. And if America stops consuming and stopped borrowing, that’s not going to hurt the global economy, that’s going to help the global economy. The rest of the world has been living beneath their means so we can live beyond ours.

PROFESSOR STEVEN KEEN: I wish that were true.

PETER SCHIFF: I think for the world the solution is to write off the US.

PROFESSOR STEVEN KEEN: I wish Peter were right that the rest of the world had its act in order. The rest of the OECD doesn’t. It isn’t just America that been borrowing more money than it’s been earning - the whole of the OECD bar one country, which has France, has been having an increase in ratio of its debt to GDP for the last 30 years. So we’re all in the borrowing game. We’ve all made the mistake of confusing money generated by real production with money you can borrow from a bank. And that’s kept on going for so long that it’s reached the point now where that game is over. If you like, it’s the old “greater fool” philosophy. You make money if you find a greater fool who borrows more money than you did to buy the same asset off you and you get away rich and they end up with even more

GEORGE NEGUS: What do we do, Peter? If you are running either the Fed in America or the Treasury, if you had all the power that comes with the stroke of a pen or hitting a computer key, what would you do right now to make sure this situation didn’t get a lot, lot worse before it gets better?

PETER SCHIFF: There is nothing I can do. It’s got to get worse before it gets better. Unfortunately for America the only way to cure these imbalances is to suffer a severe recession. There’s no way round it. All the government is doing is trying to make the situation worse in the long run by postponing it. We need to stop all this reckless consumption. We need to have much higher interest rates in the United States and we will need to allow companies to go bankrupt. We need to allow real estate prices to collapse, we need to rebalance our economy. That can’t be done without a lot of pain.

But the rest of the world - somebody is saving, somebody is loaning us this money and there are a lot of consumer goods all around America. There are factories somewhere in the world that are producing this stuff. That’s real wealth and the world has that - we don’t.

GEORGE NEGUS: Meanwhile, the upshot of all of this, of course, is people, whether it’s in Australia with the flow-on to this country, or in America, where people are losing their homes, losing their life savings, losing everything that matters to them, the whole core of their existence. It’s a very human problem in the long run, we’re talking high finance here.

PETER SCHIFF: But they never had any life savings. It was an illusion to begin with. And they’re not losing places to live. The one problem we don’t have in America is housing. We’ve got so many houses that are empty. Nobody is on the street. They are losing the fantasy of home equity. So you move out of one house and you rent another one. Nobody is going homeless.

GEORGE NEGUS: Peter mentioned the Americans should in fact raise interest rates. We have just had a lowering of interest rates in this country. Are we heading the wrong direction?

PROFESSOR STEVEN KEEN: No, no, no. The whole belief that you can manipulate the economy using interest rates has been fallacious. It’s been focusing on the rate of inflation, and believing there’s a simple inverse relationship between the rate of inflation and the rate of interest that means you can fine-tune the economy, totally ignoring in the background the explosion in private debt that’s the thing both Peter and I are focusing on.

GEORGE NEGUS: So, lower interest rates or not, are people going to lose their homes in this country?

PROFESSOR STEVEN KEEN: Yes. The scale of debt is so enormous there isn’t the physical production to back it. It’s even worse in Australia than in America - the de-industrialisation of our society in the last two decades.

GEORGE NEGUS: Are we talking here, Peter, of people’s expectations just being too high altogether because of the ready access to loan money? People think they can afford to live in ways that they can’t live.

PETER SCHIFF: People think the government has real wealth, the government can help solve problems. They can’t. All they have is a printing press. They can debase money, they can rearrange the losses, but they can’t make them go away and they can’t produce anything. And the problem on interest rates is we shouldn’t have governments setting interest rates, just as we don’t have governments setting the price of anything. They’re going to do it wrong and of course when it comes to inflation our government lies about inflation. They claim our inflation is non-existent. In the GDP deflator, where they tried to manufacture a 3% growth, the government claimed inflation in America is running at a 1.2% annual rate - the lowest in 10 years. Our inflation is over 10% a year. The government cooks the books. If the free market set interest rates, they would be much higher because nobody would loan money for below the rate of inflation.

GEORGE NEGUS: At least in this country we can say that the government are not lying about inflation. They’re actually blaming it for all the problems we have. But are they missing the point as well when they keep harping on the way they do about inflation and in fact we don’t hear much about this enormous public and private debt?

PROFESSOR STEVEN KEEN: The central banks of the world, including our Reserve Bank, and certainly the American FRB, they have forgotten the reason they were created was to some extent to prevent an occurrence like the Great Depression. They have ignored debt completely and in the meantime focused on inflation. Debt has gone through the roof. We have gone back to twice as much debt as we had before the Great Depression began and inflation, which is low, they are trying

GEORGE NEGUS: Running out of time, unfortunately, gentlemen. If I can put this to you in conclusion - would you like to be either John McCain or Barack Obama inheriting this situation as president of the United States of America in a few months time?

PETER SCHIFF: I would like to have the job, but neither one of them is up to it. They’re going to walk into a landmine and they’re going to step on every one. It’s going to be a complete disaster whoever is president and our country is in serious, serious trouble. Other countries have smaller problems but nothing like the United States. It’s a real mess and all I can say is, anybody who’s watching this in Australia, if you’ve got any money invested in any US dollar-denominated equities or debt, just sell the first chance you get.

JOHN HEINZL
When CNBC or Fox needs a guest who can be counted on to deliver a thoroughly gloomy outlook for the U.S. economy, they call on “Dr. Doom.” To say Peter Schiff is bearish is like saying Tiger Woods is an okay golfer, or China has a small problem with air quality. The president of Connecticut-based Euro Pacific Capital Inc. is so pessimistic about the U.S. economy that he lives in a rented house and keeps the vast majority of his and his clients’ money outside the country, a healthy chunk of it in gold and energy stocks. “America is finished. We are going to destroy this country. Our economy is just going to unravel,” he told me yesterday. “The question is how much money is the world going to lose before it writes us off?” Apocalyptic forecasts are a dime a dozen these days, so why should anyone pay attention to Mr. Schiff? Because his past predictions have proved uncannily accurate.

When dot-com stocks with no earnings were shooting skyward in the late nineties, he was advising clients to stay away and instead putting money into the unloved energy sector, just in time for the great oil bull market. A few years later, when the housing bubble was inflating, he was warning about the dangers of reckless mortgage lending and the precarious state of Fannie Mae and Freddie Mac. “If it looks like a bubble, walks like a bubble and quacks like a bubble, it’s a bubble,” he wrote. That was in 2004, when speculators were still lining up to buy investment properties in Las Vegas. Ever the contrarian, Mr. Schiff made a bundle shorting the subprime mortgage sector. So, one year into the credit crunch and with more than $400-billion (U.S.) of mortgage losses piling up on company books, where does Dr. Doom see the U.S. economy heading now? Unfortunately, into an even deeper hole, one from which it could take years to emerge.

Far from rescuing the economy from the housing debacle, the government’s efforts to prop up Fannie and Freddie - which own or guarantee nearly half of the $12-trillion in outstanding U.S. mortgage debt - will only compound the problem by delaying the inevitable day of reckoning. The same goes for plans to help hundreds of thousands of homeowners refinance into more affordable mortgages. Apart from encouraging the very moral hazard that got the U.S. into this mess in the first place, the government bailout will come with an enormous price tag in the form of soaring inflation, Mr. Schiff argues. He believes government figures vastly understate the true rate of inflation, which he estimates is now running at 10 to 12 per cent. Before long, it could be north of 20 per cent.

“The government doesn’t have the balls to raise taxes. It’s going to print the money. It’s going to destroy the currency,” he says. During the Depression of the 1930s, at least people who held cash made out okay. Because prices were falling, their money actually bought more. But if Mr. Schiff is right and the U.S. is heading into a period of hyperinflation, then even the most prudent savers will see their wealth eviscerated. With the walls closing in on the U.S. economy, where is an investor to turn? Apart from gold and energy producers, which benefit from a plunging U.S. dollar, Mr. Schiff likes conservative, dividend-paying stocks such as pipelines and utilities. He’s especially fond of Europe, Asia, Australia and Canada, where his holdings include Barrick Gold Corp., Goldcorp Inc., Crescent Point Energy Trust, Baytex Energy Trust and Pembina Pipeline Income Fund. He has two words for Canadian investors thinking now is a good time to shop for bargain-priced U.S. stocks: “Stay away.”

Rita Braver interviews Peter Schiff on Charles Osgood’s Sunday Morning.

By. Peter Schiff
This week, with the nation’s financial infrastructure crumbling before our very eyes, the nation’s top two economic policy makers made their way to the Congress for an extraordinary episode of political theater. Fannie Mae and Freddie Mac, the quasi-government entities that form the backbone of America’s gargantuan mortgage market, appeared to be cracking. To the somewhat bewildered members of Congress, Ben Bernanke and Henry Paulson offered radical remedies to save the lenders. Despite the fact that the proposed policies would thoroughly redefine America’s supposedly capitalistic pedigree, the moves were presented as wholly inevitable, and in the end, benevolent and costless. If you are looking for a new chapter in American history, it has just begun. More