Fun

Peter Schiff Warns Economic Downturn in the US ‘Will Be Much Worse Than the Great Recession’

News Feed - 2022-05-07 03:05:55

Peter Schiff Warns Economic Downturn in the US "Will Be Much Worse Than the Great Recession"


Following the Federal Reserve’s rate hike on Wednesday, economist Peter Schiff has had a lot to say since the U.S. central bank raised the benchmark rate by half a percentage point. Schiff further believes we are in a recession and says “it will be much worse than the Great Recession that followed the 2008 Financial Crisis.” Peter Schiff Says ‘Fed Cant Win a Fight Against Inflation Without Causing a Recession’


While many analysts were shocked by the U.S. Federal Reserve’s move, since it was the largest rate hike since 2000, a report by schiffgold.com says the increase was hardly “aggressive,” and akin to a “weak swing that looks more like shadow boxing.” Moreover, the report explains Powell’s commentary this week contained some “subtle changes,” which suggest there might be “some economic turbulence on the horizon.”


Peter Schiff doesn’t think the Fed can beat the current inflationary pressure America is dealing with today. “Not only can’t the Fed win a fight against inflation without causing a recession, it can’t do so without causing a far worse financial crisis than the one we had in 2008,” Schiff explained on Thursday. “Worse still, a war against inflation can’t be won if there are any bailouts or stimulus to ease the pain,” the economist added. I remember how strong #StockMarket pundits and economists thought the U.S. economy was right before the 2008 Financial Crisis, even though we were already in The Great Recession at the time. It wasn"t strong, it was a bubble about to pop. Today"s economy is an even bigger bubble!


— Peter Schiff (@PeterSchiff) May 5, 2022



Schiff’s comments come the day after the Fed increased the federal funds rate to 3/4 to 1 percent. Following the rate increase, the stock market jumped a great deal, fully recovering from the prior day’s losses. Then on Thursday, equity markets shuddered, and the Dow Jones Industrial Average had its worst day since 2000. All the major stock indexes suffered on Thursday and cryptocurrency markets saw similar declines.


“If you think the stock market is weak now imagine what will happen when investors finally realize what lies ahead,” Schiff tweeted on Thursday afternoon. “There are only two possibilities. The Fed does what it takes to fight inflation, causing a far worse financial crisis than 2008 or the Fed lets inflation run away.” Schiff continued: The Fed created the 2008 financial crisis by keeping interest rates too low. Then it swept its mess under a rug of inflation. Now that the inflation chickens it released are coming home to roost, it must create an even greater financial crisis to clean up an even bigger mess. Schiff Criticizes Paul Krugman, Fed Tapering Includes Monthly Caps


Schiff is not the only one that believes inflation can’t be tamed, as many economists and analysts share the same view. The author of the best-selling book Rich Dad Poor Dad, Robert Kiyosaki, recently said hyperinflation and depression are here. The well-known hedge fund manager Michael Burry tweeted in April that the “Fed has no intention of fighting inflation.” While criticizing the U.S. central bank, Schiff also railed against the American economist and public intellectual, Paul Krugman.


“Back in 2009, [Paul Krugman] foolishly claimed that QE wouldn’t create inflation,” Schiff said. “Setting aside that QE is inflation, Krugman prematurely took credit for being right as he didn’t understand the lag between inflation and rising consumer prices. The CPI is about to explode higher.” Moreover, schiffgold.com author Michael Maharrey scoffed at the Fed’s recent tapering announcement as well. Maharrey further detailed how the Fed plans to reduce the Federal Reserve’s securities holdings over time.


“As far as the nuts and bolts of balance sheet reduction go,” Maharrey said, “the central bank will allow up to $30 billion in U.S. Treasuries and $17.5 billion in mortgage-backed securities to roll off the balance sheet in June, July, and August. That totals $45 billion per month. In September, the Fed plans to increase the pace to $95 billion per month, with the balance sheet shedding $60 billion in Treasuries and $35 billion in mortgage-backed securities.” Tags in this story 2008 Financial Crisis, Central Banks, Crypto, dow jones, Economic Downturn, Fed, Fed Chair, Fed Tapering, Federal Reserve, gold, Great Recession, inflation, Inflationary pressure, jerome powell, MBS, Monetary Supply, Paul Krugman, Peter Schiff, QE, Rate Hike, Schiff, Schiffgold, stocks, US Central Bank, US economy, us treasuries, Wall Street


What do you think about the recent commentary from Peter Schiff concerning the Fed fighting inflation and the rate hike? Let us know what you think about this subject in the comments section below. Jamie Redman


Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today. Strong US Dollar Posts 5-Week High, Markets Price in a 75 bps Fed Rate Hike for June ECONOMICS | 6 hours ago US Central Bank Raises Rates by Half a Percentage Point, Fed"s Powell Says Similar Hikes Are on the Table ECONOMICS | 2 days ago


Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleKlein Finance Announced the Completion of a Funding Round With Participation From KCC Chain and KuCoin-Ventures Next articleSpanish Securities Regulator Orders Binance to Stop Offering Cryptocurrency Derivatives Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItToday"s Top Ethereum and Bitcoin Mining Devices Continue to Rake in Profits


As the crypto economy hovers just under $2 trillion in value, application-specific integrated circuit (ASIC) mining devices are making decent profits. While ASIC miners can still mine ethereum, a 1.5 gigahash (GH/s) Ethash mining device can rake in $51.58 per ... read more.NFT Sales Volume Saw a Small Uptick This Week — Moonbirds, Mutant Apes Take Top Sales Fidelity Investments Launches Crypto, Metaverse ETFs — Says "We Continue to See Demand" Economist Predicts the Fed"s Response to Inflation Will Push Crypto Higher Terra"s Algorithmic Dollar-Pegged Crypto UST Is Now the Third-Largest Stablecoin

News Feed

Billboard and Universal Music Group Partner to Launch Flow-Based NFT Collectibles
Billboard and Universal Music Group Partner to Launch Flow-Based NFT Collectibles On March 2, the global music media brand Billboard announced the firm has partnered with Universal
Bitcoin 656% Cyclical Gain Highlights Deep Market Demand – Glassnode
Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and pu
Elon Musk Ponders Tesla Putting Billions Into Bitcoin, Asking if Such Large Transactions Are Possible
Elon Musk Ponders Tesla Putting Billions Into Bitcoin, Asking if Such Large Transactions Are Possible Tesla and Spacex CEO Elon Musk made a series of tweets abou
Value Held by Blockchain Oracles Slides 61% in 7 Months, Chainlink Dominates by 45%
Value Held by Blockchain Oracles Slides 61% in 7 Months, Chainlink Dominates by 45% While the crypto economy has shed significant value, losing more than $2 trillion since the high
NBA Hall of Famer Paul Pierce Charged by SEC for Touting EMAX Tokens
NBA Hall of Famer Paul Pierce Charged by SEC for Touting EMAX Tokens The U.S. Securities and Exchange Commission (SEC) has charged Basketball Hall of Famer Paul Pierce for touting
Bitcoin halving supply shock set to shake up mining sector
Daniel Ramirez-Escudero7 hours agoBitcoin halving supply shock set to shake up mining sectorThe halving could impact the number of daily available BTC by reducing the miner rewards by 50%.1823 Total views24 Total sharesL
PEPE Slips Into Correction: Here Are Key Levels To Watch For A Rebound
Este artículo también está disponible en español. After a strong upward momentum, PEPE is showing signs of fatigue, slipping into a correctional phase, with traders specu
‘Next Round of Bailouts Is Here’ — Bitcoin and Precious Metals Soar Amid Speculation of Fed Policy Change
‘Next Round of Bailouts Is Here’ — Bitcoin and Precious Metals Soar Amid Speculation of Fed Policy Change At around 7:30 a.m. ET, the price of bitcoin skyrocketed past the $2
Washington Post, Forbes, Wall Street Journal Slammed for ‘Puff Piece’ Reports on FTX and Alameda Execs
Washington Post, Forbes, Wall Street Journal Slammed for "Puff Piece" Reports on FTX and Alameda Execs Following the highly criticized New York Times article that features commenta
Tom Mitchelhill5 hours agoApple’s headset could redefine what being in the metaverse meansKPMG"s Head of Metaverse Alyse Sue believes the tech included in Apple’s mixed reality headset could shift the way users inter
NFT sales fell 44% as crypto dipped, memecoins steal ‘mind share’ in Q2
Brayden Lindrea3 hours agoNFT sales fell 44% as crypto dipped, memecoins steal ‘mind share’ in Q2Several PolitiFi and animal-themed memecoins continued to soar in the second quarter despite the broader market downfal
Turner Wright4 hours agoJudge says Sam Bankman-Fried’s lawyers have until Sept. 1 to request a trial postponement: ReportThough the judge reportedly said he would not necessarily grant a postponement, SBF’s lawyers h