Upcoming Crash Will Be ‘Worse Than 2008’ Says Economist Peter Schiff

[Sleeping Cobra]

Wednesday, 13 Jun 2012 03:52 PM

Investors need to prepare for an upcoming stock market crash that will be “worse than 2008.”

That’s according to a well-respected author and investor, making a recent appearance on Fox Business.

Peter Schiff, the CEO of Euro Pacific Capital, says the stock market collapse we experienced in 2008 “wasn’t the real crash. The real crash is coming.”

He says that Federal stimulus, or quantitative easing, never works and that it just makes the economy sicker in the end. “The reason we are so screwed up is all this quantitative easing is toxic. I don’t doubt that we are going to pressure Germany into printing. We are like the kid who is trying to get a friend to ditch school with us to go to the beach. We are a bad influence on everybody.”

Schiff’s solution is to raise interest rates, but he acknowledges that it would bring a huge downside risk with it. “In America, the problem is that interest rates are too low. They have to go up. We can’t have an economy with interest rates at zero. If the Fed lets interest rates go up, we have to realize that we will have a deeper recession, we have to realize that banks are going to fail.”

He points out that today’s “safe haven” investments — the U.S. dollar and Treasurys — are anything but safe. “There are a lot of people who don’t understand what is going on. Look at how many people are buying the dollar. Look at people buying Treasurys. That makes no sense either. The risk lies in the dollar. The risk lies in Treasurys and other currencies being printed into oblivion.”

A noted economist agrees with Schiff that a much worse stock market crash is coming. And unlike Schiff, he has given very specific details about just how bad it will get.

“The data is clear, 50% unemployment, a 90% stock market drop, and 100% annual inflation . . . starting in 2012.”

That catastrophic outlook comes from Robert Wiedemer, economist and author of The New York Times best-seller Aftershock. Before you dismiss Wiedemer’s claims, consider this: In 2006 he accurately predicted the collapse of the U.S. housing market, equity markets, and consumer spending that almost sank the United States.

Editor’s Note: See the disturbing interview with Wiedemer.

In a recent interview, Wiedemer unapologetically displayed shocking charts backing up his allegations, and then ended his argument with, “You see, the medicine will become the poison.”

The interview has become a wake-up call for those unprepared (or unwilling) to acknowledge an ugly truth: The country’s financial “rescue” devised in Washington has failed miserably.

The blame lies squarely on those whose job it was to avoid the exact situation we find ourselves in, including current Federal Reserve Chairman Ben Bernanke and former Chairman Alan Greenspan, tasked with preventing financial meltdowns and keeping the nation’s economy strong through monetary and credit policies.

At one point, Wiedemer even calls out Bernanke, saying that his “money from heaven will be the path to hell.”

But it’s not just the grim predictions that are causing the sensation; rather, it’s the comprehensive blueprint for economic survival that’s really commanding global attention.

Shocking Footage: See the eerie chart that exposes the ‘unthinkable.’

The interview offers realistic, step-by-step solutions that the average hard-working American can easily follow.

The overwhelming amount of feedback to publicize the interview, initially screened for a private audience, came with consequences as various online networks repeatedly shut it down and affiliates refused to house the content.

Bernanke and Greenspan were not about to support Wiedemer publicly, nor were the mainstream media.

“People were sitting up and taking notice, and they begged us to make the interview public so they could easily share it,” said Newsmax Financial Publisher Aaron DeHoog, “but unfortunately, it kept getting pulled.”

“Our real concern,” DeHoog added, “is what if only half of Wiedemer’s predictions come true?

“That’s a scary thought for sure. But we want the average American to be prepared, and that is why we will continue to push this video to as many outlets as we can. We want the word to spread.”

http://www.moneynews.com/StreetTalk/...MO_CODE=F355-1

[raven]

one of the ways you can judge what he is saying is:
"Schiff’s solution is to raise interest rates, "

This is one of the solutions that should have been implemented from the start

[TerryK]

It ends with a request for $47 for a newsletter subscription.
It is the same thing they did with the first version of the book.

[Tuvia Bielski]

SCAM.

Here is another article where the last 3/4 is identical to the one above, but they start out referencing something Marc Faber said:

Faber: '100% Chance' of Global Recession

They reference these well known authorities and try to make you believe they are colleagues by transitioning to what the little know author, Wiedemer, of the book "Aftershock" has said. As was mentioned by TerryK they entice you in their pretend "interview" (which is really an infomercial) by promising you a free book, but require you to sign up for a newsletter which will cost you hundreds of dollars a year.

I'll give you their big secret for free, "buy gold".

[Y2kO]

http://www.youtube.com/watch?feature...K1OC__w#t=820s

COLLAPSE within WEEKS, RON PAUL PRESIDENCY? - Bix Weir

http://www.resourceinvestor.com/2012...recious-metals

FDIC to Classify Gold as a 0% Risk-Weighted Asset?

By James Anderson

July 13, 2012

On June 18 the Federal Deposit Insurance Corp. proposed rule changes to categorize gold as a Zero Percent Risk-Weighted, Tier 1 Asset.

This is significantly bullish for gold in the long term as this potential systemic change could drive gold demand and gold prices much higher.

In light of the global financial downturn, cash and bonds have begun to lose their luster as global financial regulators have begun to recognize the implied risks behind paper assets.

In a world characterized by central bank printing binges and rampant government spending, banking regulators are quietly being forced to recognize one of the only remaining counter-party risk free assets: Gold.

While cash, credit, and bonds can be produced at almost infinite rates, there are real supply limits to physical gold. Central banks know this fact and the world's central banks are now net buyers of gold.

Today it appears, with this latest proposed rule change from the FDIC, commercial and private banks may soon be following into the soundness and stability which only gold can provide.

Thus, as an individual investor, would you rather own a zero percent risk-weighted asset with limits to its supply? Or would you rather hold a bundle of cash, credit, and bonds whose supplies are beyond your control?

Massive currency printing and bond issuances to finance growing debt levels are ahead. The continued decrease in the value of paper assets over the longterm appear all but inevitable. As the global financial system begins to shift toward real money, the escalating gold bull market's rise should only quicken.

[milkydoo]

And what is Celente's take at the moment?

[Foothiller]

SCAM.

Here is another article where the last 3/4 is identical to the one above, but they start out referencing something Marc Faber said:

Faber: '100% Chance' of Global Recession

They reference these well known authorities and try to make you believe they are colleagues by transitioning to what the little know author, Wiedemer, of the book "Aftershock" has said. As was mentioned by TerryK they entice you in their pretend "interview" (which is really an infomercial) by promising you a free book, but require you to sign up for a newsletter which will cost you hundreds of dollars a year.

I'll give you their big secret for free, "buy gold".

Scam?

Schiff's got a better track record than Krugman or any of the asshat pundits shown disagreeing with him in the above video.

Keep watching MSM. The economy is recovering, sub-prime is contained, there is no inflation, the government supports a strong dollar policy, deficits don't matter, Iran is a threat to America, the government cares about you and represents your interests, you can trust your banker and your broker, none of the financiers committed any crimes, PMs are worthless, the Tea Party are racist whites, OWS are stinky hippies, the dollar is a good store of value, buy and hold, the terrorists do hate you for your freedom, anybody who reveres the Constitution is a terrorist, and quite likely everything wrong with this country is the liberals/conservatives fault (depending on which flavor of koolaid you like to drink), Romney really is different from Obama, Obama really is different from Bush, and Free Trade is good for America.

I could see how anyone believing some or all of those things would ridicule anyone speaking the truth. I see it every day. I saw all over TB2k during the republican primaries as hard line red-teamers AND blue-teamers criticized and insulted Ron Paul, the only candidate speaking the truth about America's foreign policy and fiscal policy.

No one likes to admit they've been had, but if you believe any of that crap then you most certainly have. Been had that is.

The scam is not Peter Schiff. It is this government, this economy, and this financial system.

The math doesn't lie and most MSM-ers don't understand math for shit. They're not programmed to do so.

I'll elaborate: the exponential function and the rule of 72. Start there. Then tell me why 2% inflation is good, and why $1.X Trillion per year deficits don't matter.

[China Connection]

Robert Wiedemer Archives July 2012

Link for links: http://www.moneynews.com/Archives/Ro...mer/103/2012/7

Jul 13, 2012 The Growth Vs. Austerity Debate Is Nonsense
Jun 15, 2012 The Deflation Myth is the Last Refuge of the Deniers
May 30, 2012 There Is No Natural Economic Growth Rate
Apr 19, 2012 It’s Not Just Housing Construction That’s Down
Mar 21, 2012 Catch Me If You Can
Mar 07, 2012 There No Other Option but to Hit The Wall
Feb 22, 2012 This Time, It’s Over
Jan 18, 2012 US is a Lot Like Bernie Madoff’s Clients
Dec 28, 2011 Don't Buy Into All of the New Year’s Traditions
Dec 15, 2011 The Manic-Depressive Stock Market
Nov 30, 2011 The Real Question in the European Debt Crisis
Oct 19, 2011 Stock Market Mentality is Changing, Part 2
Sep 28, 2011 Investors’ Mentality Toward Stocks Is Changing
Aug 24, 2011 Gold Is Beginning to De-couple
Aug 03, 2011 Don’t Blame the Messenger: Inflation to End 'Free Lunch'
Jul 13, 2011 The Next Big Mantra to Explain All the Nonsense
Jun 29, 2011 If US Loses Economic Stability, so Will the World
Jun 15, 2011 Teachin' Ben a Lesson
May 25, 2011 '70s Flashback: High Oil Prices May Fuel Inflation
May 06, 2011 Market to Stay Volatile as QE2 Nears End
Apr 20, 2011 The 'Recovery' Is 100 Percent Fake
Apr 06, 2011 Let’s Get Some Perspective on Budget Battle
Mar 23, 2011 Dollar Falling, Not Rising, in Recent Crises
Mar 10, 2011 Construction Gives Clear View of Economy's Health
Feb 24, 2011 Unions Must Accept That Lofty Pensions Nearing End
Feb 09, 2011 The Egyptian Crisis and Productivity
Jan 19, 2011 No New Households, No New Homes
Jan 05, 2011 The Fed as the Guarantor of Asset Values
Dec 08, 2010 'Money From Heaven' Is the Path to Hell
Nov 24, 2010 Giving Thanks for What's Really Important
Nov 10, 2010 Lawmakers Have Their Work Cut Out on Overspending
Oct 27, 2010 Wall Street Turns Blind Eye as Jobs Just Vanish
Oct 13, 2010 This Precious Metal May Be Entering Its Golden Age
Sep 29, 2010 They Know a Lot More Than They’re Saying
Sep 15, 2010 It's Hard to Have Faith in the Stock Market Right Now
Sep 01, 2010 With Head in the Clouds, Fed Ignores Inflation Mountain
Aug 18, 2010 Watching the Bubbles Will Prevent a ‘Lost Decade’
Aug 04, 2010 Stock Market Is the 'Keystone Bubble' Right Now
Jun 16, 2010 Lack of Jobs Is Really a Matter of Bubble Trouble
May 13, 2010 Waiting for the World's Bubble Economy to Pop
May 03, 2010 Tax Hikes to Cut the Debt? It's a Numbers Game
Apr 26, 2010 Beware Backlash When U.S. Finally Comes Up Short
Apr 20, 2010 A Coming Avalanche of Inflation

//////////////////////////////////////////////////////////////////////////////////////

The Growth Vs. Austerity Debate Is Nonsense

Friday, 13 Jul 2012 01:05 PM

By Robert Wiedemer


There is rally only one course. Austerity or MUCH MORE austerity later. If you don’t reduce your borrowing now, borrowing more will only increase the amount you owe, not decrease it.

Sure, that may make life easier now, but it only will make for much more demanding austerity later when you can’t borrow more money.

By borrowing more now, you are not promoting fundamental growth, you are promoting growth based on borrowing. That won’t work long term.

Editor's Note: Economist Warns: 50% Unemployment, 100% Inflation Possible

Sure, if you make a lot of changes to solve the fundamental causes of the massive borrowing, then maybe you could argue that more borrowing now makes sense. And, that is an argument many economists use. But, in practice, there is really very little attempt at fundamental change. Just the opposite, more borrowing is usually just a way to AVOID fundamental change.

Although this debate is a bit more out of the news after the Greek and French elections it is still a huge issue. Spain is facing austerity and so are many other countries. All will be facing tremendous pressures not to cut spending.

The counterargument is that austerity will force the economy in to a downward spiral by discouraging consumer spending. That is true. But, that’s not austerity’s fault. If your economy is so dependent upon government borrowing to grow or maintain itself then your economy has a much bigger and more fundamental problem.

The underlying fundamental problem is that much of their growth wasn’t based on real economic growth, but bubble economic growth. In Spain, it was a massive housing bubble.

In Greece, it was a massive government spending bubble and private borrowing bubble. Many other countries, both publicly and privately, have also borrowed much more than they can pay back. Yes, that has boosted growth in the past decade but it is bubble growth and stops as soon as the bubble pops.

So, in imposing austerity, you are exposing the bubble nature of these economies. Their growth is not based on fundamental productivity improvement; it is based on public credit, private credit, real estate and other bubble growth. So, imposing austerity will pop these bubbles. That’s bad.

But, pumping up the bubbles even more is even worse.

Editor's Note: Economist Warns: 50% Unemployment, 100% Inflation Possible

Yes, these countries can simply deny that bubble growth was driving them and borrow more, or make the more difficult choice to pop the bubbles and focus on improving productivity to get real economic growth. Determining which is the correct choice is easy — pop the bubbles and focus on improving productivity growth.

However, making that choice is not easy. In fact, it’s pretty clear those countries will not make that choice. Instead, they will likely choose to support “growth,” which in their context is another word for more borrowing, more money printing and no fundamental changes.

Ultimately, that means they are choosing to hit the wall in some way. The borrowing and money printing can’t go on forever but, at least in the short term, it’s a lot easier and more popular in those countries than popping the bubbles and getting down to the hard work of improving productivity

Read more: The Growth Vs. Austerity Debate Is Nonsense

http://www.moneynews.com/Archives/Ro...mer/103/2012/7

[Tuvia Bielski]

Scam?

Schiff's got a better track record than Krugman or any of the asshat pundits shown disagreeing with him in the above video.

Keep watching MSM. The economy is recovering, sub-prime is contained, there is no inflation, the government supports a strong dollar policy, deficits don't matter, Iran is a threat to America, the government cares about you and represents your interests, you can trust your banker and your broker, none of the financiers committed any crimes, PMs are worthless, the Tea Party are racist whites, OWS are stinky hippies, the dollar is a good store of value, buy and hold, the terrorists do hate you for your freedom, anybody who reveres the Constitution is a terrorist, and quite likely everything wrong with this country is the liberals/conservatives fault (depending on which flavor of koolaid you like to drink), Romney really is different from Obama, Obama really is different from Bush, and Free Trade is good for America.

I could see how anyone believing some or all of those things would ridicule anyone speaking the truth. I see it every day. I saw all over TB2k during the republican primaries as hard line red-teamers AND blue-teamers criticized and insulted Ron Paul, the only candidate speaking the truth about America's foreign policy and fiscal policy.

No one likes to admit they've been had, but if you believe any of that crap then you most certainly have. Been had that is.

The scam is not Peter Schiff. It is this government, this economy, and this financial system.

The math doesn't lie and most MSM-ers don't understand math for shit. They're not programmed to do so.

I'll elaborate: the exponential function and the rule of 72. Start there. Then tell me why 2% inflation is good, and why $1.X Trillion per year deficits don't matter.

I was probably unclear and so was misunderstood.

I am a huge fan of Schiff and Faber. My point was that the article and the Wiedemer "interview" is a scam. They are trying to part you from your money by getting you to sign up for an expensive newsletter. He is trying to associate himself with Schiff and Faber by starting out the article referencing those authors, when I doubt they are associates at all.

What newsmax.com and moneynews.com are selling is information available elsewhere for a low cost (buy Schiff's books) or free by reading various sites such as for example TB2K.

Sorry for the confusion.

[shane]

The dollar is undeniably, without question, the best looking horse...
in the glue factory!

- Shane

[Double_A]

It ends with a request for $47 for a newsletter subscription.
It is the same thing they did with the first version of the book.

What? Is it suddenly not popular to make money? lol.

Peter Schiff was roundly ridiculed in his predictions that we were heading for disaster before 2008. I watched business news programs in 2009 where he said we have more to come and those "Business Experts" on TV laughed and ridiculed him.

You may think he's just pushing his book, don't buy it, I haven't. But I pay attention to what he says. Discernment is important to separate the wheat from the chaff and frankly MSM is chaff and frankly Schiff has been far more accurate in my opinion than others.

[Countrymouse]

So..........if stocks are about to be lose "90% of their value", then should I invest in the bank of Sealy Postur-Pedic?

Or is the dollar itself also about to lose 90% of its value?

Since some are saying don't listen to the spiel or buy the books, but are apparently familiar with his advice, I'd like to know what options (if any) there are for holding on to our wealth---is buying gold the ONLY option? And if I turn all my assets into gold, what exactly am I supposed to spend to pay the light bill or groceries?

[Vegas321]

The problem with raising the interest rates, is that it will cause the complete collapse of the derivatives market. The Fed is in a box with no way out. Once they raise interest rates (and they will) it's finished.

That IMHO will be what we will see as the end game.

[Double_A]

So..........if stocks are about to be lose "90% of their value", then should I invest in the bank of Sealy Postur-Pedic?

Or is the dollar itself also about to lose 90% of its value?

Since some are saying don't listen to the spiel or buy the books, but are apparently familiar with his advice, I'd like to know what options (if any) there are for holding on to our wealth---is buying gold the ONLY option? And if I turn all my assets into gold, what exactly am I supposed to spend to pay the light bill or groceries?

What information are you looking for? There has been lots of info posted over the last few years, like maybe a couple of threads a week. Were those not helpful?

[Richard]

let's face it economists have no answer to the problem of booms and busts, economics is a pseudoscience, maybe there IS no answer

[Dozdoats]

I'd like to know what options (if any) there are for holding on to our wealth---is buying gold the ONLY option? And if I turn all my assets into gold, what exactly am I supposed to spend to pay the light bill or groceries?

Not knowing anything at all about your financial situation, and not being trained/certified/licensed to provide financial advice, I cannot tell you what you should do. But I can point out some things to consider.

Number one, a good understanding of economic fundamentals is critical. Without that, it is impossible to make good financial decisions for either the short term or the long term. I'd suggest starting with http://www.bluestockingpress.com/wha...enny-candy.htm. I like Maybury's approach, I'm a long-time subscriber to his newsletter, and therefore some might consider me biased. I prefer to think that I have examined the available options and made a good choice for a source of advice.

If you want a deeper and broader understanding, go to www.mises.org and do some reading/study there. These sources will introduce you to Austrian economics, which is fundamentally different in important ways from Keynesian theory, the predominant economic doctrine of our age and the source of most of our economic problems (outright criminality and greed brings us the rest).

"Buy gold" is a knee-jerk, throwaway suggestion and not one that is correct for every person and every situation. There are other things that should be done first, other things that are more important. There are a lot of problems gold won't fix (though there are some for which it is the only solution). No one approach works for every situation. Flexibility and a fundamental understanding of the problems and possible solutions are necessary to make good decisions. Fix your personal financial situation first - manage debt, have some cash on hand (enough to pay a month's worth of bills to start with), see to basic preps. When those things are done, if there is still money left over or coming in, it is time to start considering preserving purchasing power. I'd start with silver, 1964 and earlier US silver coins that are 90% silver - aka "junk silver."

YMMV of course. Do your own due diligence in every important decision. But understand that hoping it will all go away is not a workable approach. This is one problem that must be confronted and dealt with - or it will deal with you.

[Tuvia Bielski]

So..........if stocks are about to be lose "90% of their value", then should I invest in the bank of Sealy Postur-Pedic?

Or is the dollar itself also about to lose 90% of its value?

Since some are saying don't listen to the spiel or buy the books, but are apparently familiar with his advice, I'd like to know what options (if any) there are for holding on to our wealth---is buying gold the ONLY option? And if I turn all my assets into gold, what exactly am I supposed to spend to pay the light bill or groceries?

<$0.02>

It is probably unrealistic to think that we can put our assets into a fixed portfolio (PMs, cash, bonds, stocks, real estate) now and come out on the other side of this economic storm intact, let alone a single asset (e.g. gold). We may have to make adjustments as events develop. And we will likely have to be agile and able to think months ahead of the herd. All that being said, there are a probably a few things that can be done now.

All of what I state below has been mentioned across the interwebs and by respected economists (e.g. Schiff) many times and so I cannot claim credit. I am simply attempting to aggregate these ideas succinctly.

1) Pay down debt.
2) Have some cash reserves (e.g. FRNs under your mattress) for 2 months of expenses.
3) Own precious metals (5-15% of your investable portfolio assets). Have these in your possession. ETFs may not be safe.
4) Income producing assets (e.g. farm land you rent out)
5) Dividend stocks in companies that produce staples. These companies will probably make it through the global financial reset. They will tend to be a reasonable hedge against inflation.

</$0.02>

[China Connection]

All the static investments are full of risk. I have been buying things that I think will give me a chance to earn an income. Say something like agricultural fertilizer can be used to grow food, sell, barter and say provide for part of a crop in return to someone who is in need of fertilizer.

[Double_A]

<$0.02>

It is probably unrealistic to think that we can put our assets into a fixed portfolio (PMs, cash, bonds, stocks, real estate) now and come out on the other side of this economic storm intact, let alone a single asset (e.g. gold). We may have to make adjustments as events develop. And we will likely have to be agile and able to think months ahead of the herd. All that being said, there are a probably a few things that can be done now.

All of what I state below has been mentioned across the interwebs and by respected economists (e.g. Schiff) many times and so I cannot claim credit. I am simply attempting to aggregate these ideas succinctly.

1) Pay down debt.
2) Have some cash reserves (e.g. FRNs under your mattress) for 2 months of expenses.
3) Own precious metals (5-15% of your investable portfolio assets). Have these in your possession. ETFs may not be safe.
4) Income producing assets (e.g. farm land you rent out)
5) Dividend stocks in companies that produce staples. These companies will probably make it through the global financial reset. They will tend to be a reasonable hedge against inflation.

</$0.02>

add my 2 cents to your portfolio. That's been the basically what all of us have been saying for years. Agricultural land is in great demand Many large Real Estate trusts are buying it up and even selling paper shares Silver has been called "poor man's gold" for many many decades. Pay off your debt has been in the top 5 things to do.

[Shea Grey]

sound investments, circa 2012

[milkydoo]

The dollar is undeniably, without question, the best looking horse...
in the glue factory!

- Shane

That's a good one.

[TECH32]

The problem with raising the interest rates, is that it will cause the complete collapse of the derivatives market. The Fed is in a box with no way out. Once they raise interest rates (and they will) it's finished.

That IMHO will be what we will see as the end game.

They won't raise rates until they have to - and right now they don't have to. As long as either A) others are willing to buy our debt or B) they continue to print money to buy our debt, there's no reason to raise rates.