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Peter Schiff: The Dollar Is Not Just Going Down; It’s Going to Crash
Peter Schiff: The Dollar Is Not Just Going Down; It’s Going to Crash
As gold was closing in on its all-time record price last week, Peter Schiff appeared on the Claman Countdown and warned about the looming dollar crisis.
Claman set up the interview pointing out that Peter predicted this big move up in gold months ago and asked, “What’s your new prediction about the dollar?”
Peter said it’s not really a new prediction, but perhaps it’s more timely.
The dollar’s not just going down. It is going to crash.”
Prior to the interview, Claman mentioned that the Dow was up, but Peter said there is another way to look at it.
Priced in real money, gold and silver, the Dow is actually down. And what gold is telling you, and silver, is that the dollar is losing value. It’s losing purchasing power.”
The dollar had been drifting lower against other fiat currencies over the past several weeks. At the time of the interview, the dollar index was just a few ticks off its March low.
But I think the dollar is going to keep drifting down until it collapses,” Peter said. “And this is going to usher in a real economic crisis in America, unlike something we’ve ever seen. Because it’s going to force the Fed to choose between saving the dollar, and dumping all the bonds its been buying, letting interest rates rise sharply, forcing the US government to slash spending right now and abandon all these stimulus plans, or just let inflation ravage the entire economy and wipe out a generation of Americans.”
Claman asked Peter what is the trade given what’s coming down the pike. Peter said his advice is “to get out of Dodge.”
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The Elites Are Already Prepared for the Coming Collapse of the Dollar Bubble
The Elites Are Already Prepared for the Coming Collapse of the Dollar Bubble
Today, stock market investors are hoping desperately for Weimar-style hyperinflation to boost equities prices to dizzying heights in what some call a “crack-up boom”. In terms of money creation, we are not there yet, but such levels of fiat printing could happen within the next year. Unfortunately for investors, this “boom” in stocks may not happen again. In fact, it already happened over the course of the past several years, and now the party is over. In the past few months, the U.S. dollar has entered a massive liquidity crisis, and despite all expectations, the Fed’s attempts to compensate with stimulus measures have done little to boost markets back to their previous glory.
In Weimar Germany, stocks did get an epic rally, until it all came crashing down in 1924 and then again in 1927. The notion of the endless fiat-driven bull market is a lie perpetuated by central bankers and their cheerleaders.
As I warned in past articles, when the Fed finally decided to step in to “stall the crash”, it was after it was far too late. The Fed has no intention of stopping the crash, they WANT a crash; they created all the conditions necessary for the collapse of the Everything Bubble to happen. Their goal now is only to make it appear as though they “did everything they could” to save the economy while staging the collapse of the final bubble: the U.S. dollar and its global reserve currency status.
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Why a bear market will lead to a dollar collapse
Why a bear market will lead to a dollar collapse
Falling equity markets this week are likely to signal the onset of a bear market, responding to a combination of the coronavirus spreading beyond China and persistent indications of a developing recession.
This has provoked a flight into US Treasuries, with the ten-year yield falling to an all-time low of 1.31%. This will prove to be a mistake, given US price inflation which on independent estimates is running close to ten per cent, exposing US Treasuries as badly overpriced.
After this short-term response, much higher US Treasury yields are inevitable. Foreigners, who possess more dollars and dollar investments than the entire US GDP will almost certainly sell, driving bond yields up and the dollar down, leaving the Fed the only real buyer of US Treasuries.
This article goes through the sequence of events likely to destroy value in US financial assets and the dollar as well. And what goes for the US goes for all other fiat-currencies and their financial markets.
Introduction
In my last article I pointed out that the cumulative effect of central bank intervention has led to bond prices that have come badly adrift from reality. Taking a more realistic estimate of the dollar’s purchasing power than that implied in goal-sought CPI numbers, plus an estimated amount for the time preference involved, ten-year US Treasuries should yield closer to 10% to maturity, not the 1.31% implied today. If a ten-year bond has a coupon such that it is currently priced at par, the price should halve.
Those who put our monetary misfortunes down to the coronavirus have missed the point. Yes, it will be fatal, both economically and unfortunately for some of us as individuals as well. It is early days in what is definitely becoming a pandemic, that is to say an epidemic that is not restricted to national boundaries.
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Insider Alan Greenspan Warns of Explosive Inflation: “Tinderbox Looking For a Spark”
Insider Alan Greenspan Warns of Explosive Inflation: “Tinderbox Looking For a Spark”
Last month it was revealed that former federal reserve Chairman Alan Greenspan, the architect of U.S. monetary policy under four Presidents, is anticipating a significant market event as a result of the trillions of dollars that have been pumped into the system over the last several years. According to Greenspan, something big is coming.
His comments were shared by well known resource analyst Brien Lundin, who joined Greenspan for private discussions at last year’s New Orleans Investment Conference. In his latest interview Lundin further clarifies Greenspan’s private thoughts on current economic and monetary policy and sheds light on the former Fed Chairman’s suggestion that ‘something big is coming.‘
Greenspan made some good points to me… He was concerned about inflation… He was specifically concerned in relation to the outstanding, or excess, reserves which are close to three trillion dollars being held on the Fed balance sheet now… That money is just hanging over the U.S. economy like a big water balloon of liquidity and it’s just searching for a pin.
In fact, Greenspan referred to it as a tinderbox of explosive inflation looking for a spark.
Greenspan believes that in five years gold will be “measurably higher” than current levels because of the excess liquidity that will eventually be released into the open market. Such an event will undoubtedly lead to riots across America as the general public, woefully unprepared for rapidly rising prices when the pin finally pops the dollar bubble, loses access to affordable critical supplies like food, gas and other resources.
The collapse of the dollar, an inevitability suggested by Alan Greenspan, will be a game changer that results in the quadrupling of the cost of living for the average American.
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