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Thread: Schiff Backs Down from Hyperinflation Debate

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    Default Schiff Backs Down from Hyperinflation Debate

    http://globaleconomicanalysis.blogsp...om-debate.html


    Schiff's changing his tune. In a recent interview he said, "I still say that hyperinflation is a worst case scenario. I never say we are going to have it for sure."

    He's also backing down from a commitment to debate Mish about hyperinflation.



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  3. #2
    Member Zippyjuan's Avatar
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    Schiff in 2009 on Glen Beck (repeated in the NY Times December 2011):
    http://krugman.blogs.nytimes.com/201...n-predictions/
    Peter Schiff on Glenn Beck, Dec. 28, 2009:


    PAYNE: So, where are you then, Peter, with respect to inflation? Do you think this is going to be the big story of 2010?

    SCHIFF: You know, look, I know inflation is going to get worse in 2010. Whether it’s going to run out of control or it’s going to take until 2011 or 2012, but I know we’re going to have a major currency crisis coming soon. It’s going to dwarf the financial crisis and it’s going to send consumer prices absolutely ballistic, as well as interest rates and unemployment.

    PAYNE: And what does that mean? For people watching this show, what does that mean for the average American?

    SCHIFF: It means their life is going to get a lot more difficult. It means things that they need to buy, things like food and energy, are going to be much more expensive. Ultimately, interest rates are going to rise and their entire standard of living is going to plunge.

    And I’m hoping the government doesn’t respond to this inflation with price controls because that’s going to make it even worse. Now, you’re going to be waiting in long lines to get basic food items or to get energy because there’s going to be shortages. People might be going to the black market.

    PAYNE: You’re talking you’re talking Zimbabwe, Weimar, Germany — I mean, you’re really talking about something like that actually happening in this country.

    SCHIFF: It will happen if we don’t change policies. There is still time to change.

    PAYNE: Right.

    SCHIFF: I mean, I’m running for the United States Senate, so I can try to change that myself. But if we don’t reverse course, if we continue to stimulate, then we will end up with hyperinflation and it will be like Zimbabwe.
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  4. #3

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    Schiff has nearly always qualified the hyperinflation call as a worst case scenario and not guaranteed. The only time he doesn't qualify the hyperinflation call is when he's on some combative panel of CNBC idiots and he gets all worked up. Schiff has a gigantic chip on his shoulder from being laughed at for years on financial media.

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    Member Zippyjuan's Avatar
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    Just curious- has Schiff ever had anything positive to say about the economy- even before the current economic crisis- or is he always bearish?
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    Interview in 2002 when he was also predicting doom. He said we were entering a bear market and was predicting high inflation in the next couple years back then as well. Prediction was for the DOW to go down to 2000 and NASDAQ to 500 and interest rates "through the roof". DOW was 10,000.

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  7. #6

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    Think this is bad someone should do a "best of Alex Jones" (hello Hot Topics)

    I for one find apocalyptic rhetoric and the idea that abolishing the fed is a cure all to be dangerous.

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    Quote Originally Posted by thequietkid10 View Post
    Think this is bad someone should do a "best of Alex Jones" (hello Hot Topics)

    I for one find apocalyptic rhetoric and the idea that abolishing the fed is a cure all to be dangerous.
    Dangerous to who? The fed?
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    Lol been a while..



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  10. #9

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    Mish is a bloodsucker and Schiff doesn't want to feed him with his blood.
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  11. #10

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    I have yet to hear any reasonable explanation of how the US government can pay its debts and meet its promises. That means it will either default by not paying or it will "meet" its debts and obligations by creating money. If someone has another escape route, I would like to hear it.

    Given the two choices of simply NOT making the payments versus making the payments with a vast flood of new, devalued money, I predict the second path because it can delay the day of wreck-oning. Politicians are mostly cowards who will postpone facing reality.

    The dramatic expansion of the money supply needed to "meet" its obligations WILL cause inflation. Hard to say if it will be a hyperinflation, but that would be my guess. In any event it will be enough inflation to turn the economy on its head and ruin millions of lives.
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  12. #11

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    Hyperinflation isn't tied to expansion of the money supply. Its tied to a loss of faith in the currency. This causes the velocity of money to explode.

    QE is causing serious inflation, but its uneven as it is fighting massive deflationary forces as defaults are causing the money supply to collapse.
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  13. #12

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    Quote Originally Posted by sgt150 View Post
    Dangerous to who? The fed?
    Yes I'm sure that the fed is quite afraid of critics who have made repeated specific predictions of incoming doom due to fed actions and repeatedly have been wrong.

  14. #13

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    Quote Originally Posted by thequietkid10 View Post
    Think this is bad someone should do a "best of Alex Jones" (hello Hot Topics)

    I for one find apocalyptic rhetoric and the idea that abolishing the fed is a cure all to be dangerous.
    Schiff doesn't even advocate getting rid of the Fed. He talks how bad its mismanaged in regards to bailouts and interest rates but I've never heard him blame the Fed for all of our problems.

    I listen to his radio show almost every weekday, he puts blame on congress much more than the Fed and I never heard him say if we just end the Fed all problems will be solved.

  15. #14

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    I assume Schiff has made money for his investors in Euro Pacific, but his public punditry has been bearish for as long as I can remember.

  16. #15

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    Quote Originally Posted by Zippyjuan View Post
    Just curious- has Schiff ever had anything positive to say about the economy- even before the current economic crisis- or is he always bearish?
    Since he has been on record, have we ever had a true free market with sound money? then no, he has been bearish and for all the right reason. have you read how an economy grows and why it doesn't?

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  17. #16

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    While you make a good point, ultimately the loss in faith stems from expansion of the base money supply by GOVERNMENT. That is to say, arbitrary expansion without the required growth in capital creation to back more units of trade.

    Confidence does not evaporate "Just because". Confidence is eroded by bad policy.

    It is bad policy to paper over debt problems with confetti.

    Quote Originally Posted by idiom View Post
    Hyperinflation isn't tied to expansion of the money supply. Its tied to a loss of faith in the currency. This causes the velocity of money to explode.

    QE is causing serious inflation, but its uneven as it is fighting massive deflationary forces as defaults are causing the money supply to collapse.
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  18. #17

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    Quote Originally Posted by Zippyjuan View Post
    Just curious- has Schiff ever had anything positive to say about the economy- even before the current economic crisis- or is he always bearish?
    There is nothing positive to say about the economy for about the last 30 years.
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  19. #18

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    Quote Originally Posted by Acala View Post
    I have yet to hear any reasonable explanation of how the US government can pay its debts and meet its promises. That means it will either default by not paying or it will "meet" its debts and obligations by creating money. If someone has another escape route, I would like to hear it.

    Given the two choices of simply NOT making the payments versus making the payments with a vast flood of new, devalued money, I predict the second path because it can delay the day of wreck-oning. Politicians are mostly cowards who will postpone facing reality.

    The dramatic expansion of the money supply needed to "meet" its obligations WILL cause inflation. Hard to say if it will be a hyperinflation, but that would be my guess. In any event it will be enough inflation to turn the economy on its head and ruin millions of lives.

    Adding to this...

    Schiff says in the exact same interview that if we get inflation of 30-40% and maintain ourselves is that not still a hyperinflation of sorts? I think what Schiff is pointing out is that a full scale collapse will not happen but a serious devaluation is still possible and in his mind still on the horizon.

    That or he's peddling doom to sell his gold and silver...
    It's just an opinion... man...

  20. #19

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    It's probably wiser that he doesn't.

    I mean, if we go on and on preaching to heavily about hyper-inflation (however possible it may be), and yet people see that we don't have hyper-inflation, then it sort-of ruins our credibility. We can keep talking about it, but you know, just don't over-do it and don't give a definite date of "okay we'll see hyperinflation on june 3rd, 2013" or something. Because if it doesn't happen, then it looks like the people who are always talking about how the world is gonna end on such a date, and then nothing happens.

    It's better just to wait until the event occurs and then be like, "see, I told you, but you idiots wouldn't listen."
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  21. #20

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    It's also possible that the goal of the people in charge is not to let it go into hyperinflation, but just to continue as they always have done, which is playing off of centrally-planned cycles of inflation and deflation. Take the housing crisis, for example. The deflationary period that happened in the housing market was a chance for the big players to consolidate their holdings, and now we're going up again, so the cycle will probably repeat. Last year was a hard year for Georgia banks because it seemed like every week you heard about the FDIC folding a smaller bank into a larger one.

    We create some gigantic financial institutions thanks to the boom-bust cycles. Buy low, sell high. Buy low, sell high. Buy low, sell high. And if you have friends at the Fed who can let you know when to expect a low and when to expect a high, it's a rigged market.
    Last edited by nobody's_hero; 11-30-2012 at 06:39 PM.
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    Quote Originally Posted by thequietkid10 View Post
    Yes I'm sure that the fed is quite afraid of critics who have made repeated specific predictions of incoming doom due to fed actions and repeatedly have been wrong.
    Like predicting the housing collapse that happened for instance?
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  23. #22

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    Just because Schiff sees whats coming earlier than anyone else doesn't mean he is wrong. I feel hyperinflation is certainly in the cards. Schiff's mistake was not seeing the rest of the world following in the US's footsteps proping us up for a while.

  24. #23

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    Hyperinflation is inevitable, as the US dollar loses its reserve status and the mind-boggling amount of US dollars held in reserve by the rest of the world comes flooding back here. Same thing happened to Weimar Germany, they paid other countries in printed marks, those marks came flooding back in and hyperinflation resulted.

    Now this isn't to say that it's going to happen tomorrow, but it will happen. Fiat currencies are doomed in the zero-trust environment created by the world's central bankers and deficit-spending governments.
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  25. #24

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    Quote Originally Posted by cubical View Post
    Just because Schiff sees whats coming earlier than anyone else doesn't mean he is wrong. I feel hyperinflation is certainly in the cards. Schiff's mistake was not seeing the rest of the world following in the US's footsteps proping us up for a while.
    Yeah, but if I say that the United States will cease to be a country in the future, I'll be right considering the fact that no country lasts forever, but I'll lose credibility because it's not going to happen in any kind of foreseeable future.

    Hyperinflation is NOT likely to happen in the United States within any kind of workable future. I know many doomsayers will disagree, but it's not.
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    god damn vipers, all of them.

  26. #25

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    Quote Originally Posted by ShaneEnochs View Post
    Yeah, but if I say that the United States will cease to be a country in the future, I'll be right considering the fact that no country lasts forever, but I'll lose credibility because it's not going to happen in any kind of foreseeable future.

    Hyperinflation is NOT likely to happen in the United States within any kind of workable future. I know many doomsayers will disagree, but it's not.
    He said there was a housing/debt bubble in 2002, he was right 4 years later. Don't act like nothing he says has come true. He was wrong on the strength of the dollar, but will soon be right.

    I disagree about hyperinflation. I think it will occur soon(less than 10 years). The pressure on rates to move higher will be too great.

  27. #26

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    Lemme know when a Union wants to get paid in Euros or gold rather than more dollars.
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  28. #27

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    Now that we passed the "off the cliff date". it all makes perfect sense to the common man:

    When they took away the penny, I didn't speak up... After ll, how much can a penny buy these days?
    When they took away the nickel I didn't speak up...
    When they took away the dime, I didn't speak up...
    When they took away the quarter, I didn't speak up...
    When they took away the half-dollar, I didn't speak up...
    When they took away the dollar, Well, I never liked that Suzan B Anthony coin anyhow,
    but when I found out the paper dollar bill was going away too, I said, "hey now, wait a minute..."

    Then I looked into buying gold, but it was just too darn expensive.

    That guy on the news said I could exchange five of my one dollar bills for a nice new five dollar bill, imagine that...

    It's that simple. I felt like a fool, so I shut up again and bought a Powerball lotto ticket!

    +++

    Now, quit your complaining and go find a government protected job that gets automatic pay raises (locked to inflation)!

  29. #28

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    Quote Originally Posted by sgt150 View Post
    Like predicting the housing collapse that happened for instance?
    How many housing bubbles have there been throughout American history?

  30. #29

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    Quote Originally Posted by Jordan View Post
    How many housing bubbles have there been throughout American history?
    How many more can the system sustain? The numbers and charts look awfully volatile, especially as time progresses. The booms get bigger as do the recessions erhm "slowdowns/recessions".

    In addition to the topic: Well, what's the alternative? Perpetual purchasing of $40 Billion in MBS every month until the economy gets better? Unfortunately the "print & pray" approach doesn't bode well for the future IMO. We either absolve the debt through choice (assuming the choice is still there, I'm not even sure) or print to infinity and wait for inevitability.

  31. #30

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    ya know, a lot of the Austrians (Ron Paul included) who have harped about mass inflation for the last 5 years have simply been wrong. Granted, eventually it will come but Schiff and the others who screamed that the sky is falling have just been wrong. At this point at least.

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