printable article

Originally published October 8 2013

Peter Schiff compilation video reveals mainstream media to be wildly delusional on Fed fiscal policy

by J. D. Heyes

(NaturalNews) The operations and functions of the Federal Reserve remain foreign to most Americans who simply do not understand how the nation's central bank functions. Most are also unfamiliar with monetary and fiscal policies as they pertain to the overall health of the U.S. financial system.

But suffice it to say that the overall function of the Fed is primarily a game of calculation and manipulation by an elite few led by the Federal Reserve chairman, but certainly, he does not operate on an island.

What passes these days for American monetary and fiscal policy, vis-a-vis the Fed, is a sham, pure and simple. It is a shell game that, but for the sheer size of the U.S. economy, would have long since collapsed. But that day is coming; think of the Fed as one gigantic housing bubble set to burst.

Enter Peter Schiff, truth teller and visionary

Someone who is intimately familiar with the Fed is Peter Schiff, an American businessman, investment broker, author and financial commentator. In the year preceding the start of the Great Recession in 2007, Schiff often - and accurately - discussed the coming economic collapse, which was led by the housing bubble burst, but he was nonetheless widely mocked by many of his constituents, most of whom were simply flat-out wrong in their own analyses and predictions.

In fact, one of the most viral videos, garnering more than 2 million views, was a compilation of Schiff interviews before the collapse, in which he accurately forecast what was to come (that video is here).

In the compilation video, Schiff says the coming recession would not "last for quarters, but for years." He said the problem stemmed from "too much consumption and borrowing, and not enough production and savings." Such predictions and analysis are completely rebuffed by Arthur Laffer of Laffer Investments, a former Reagan administration official, who, when asked if he believed Schiff, replied, "No, I do not believe any of it, whatsoever."

Laffer countered that stocks were up and much more wealth had been created, but Schiff countered - correctly, as time would tell - that much of that was "paper wealth" that would be "wiped out" in the collapse. For the record, Americans, by most estimates, lost about $16 trillion in household wealth. Where's Art Laffer today?

In a late 2006 Fox Business interview, one guest predicted a 10 percent rise in home values in 2007; Schiff essentially predicted the housing burst, to which a third guest replied, "I have no idea what Peter Schiff is talking about." Both of those guests openly mocked and laughed at Schiff.

Then, when the collapse came, some analysts said it was just a small problem, that it would pass quickly and that the overall economic damage would be minimal. Schiff said, "This is just getting started." Again, who was right?

"It's not just" the subprime loans that were being affected, Schiff said on Fox Business. "This is a problem for the entire mortgage industry. It's not just people with bad credit that committed to mortgages they can't afford. It's not just people with bad credit that are gonna see their home equity vanish. And it's not limited to mortgage credit. Americans are going to have a difficult time borrowing money to buy cars, to buy furniture, to buy appliances.... Foreigners around the world have been lending us money for years (and) they're now finding out that we can't afford to repay.

"This is going to be an enormous credit crunch. The party is over for the United States. We cannot continue borrowing to live beyond our means," he said.

More truth from the one guy who seems to get it

Spot on. He also went on to advise investors to "stay away from the financials" - financial firms like Goldman Sachs and Merrill Lynch, the latter of which was sued by employees who won a $75 million settlement to recover losses sustained from the collapse. And he also successfully predicted gold's meteoric rise in value.

Well, there's more, but you get the picture. Now, there is a second video compilation featuring additional Schiff predictions. One of the most "controversial" is his belief that the Fed's announced "tapering" of printing $85 billion and pumping it into the economy every month (the so-called Quantitative Easing) is a hoax. And, as usual, he's being mocked.

But he was right. In mid-September, the Fed announced it would not taper.

Decide for yourself who's telling the truth - a guy who's been consistently right, or everyone else who's part of the Business Establishment.


All content posted on this site is commentary or opinion and is protected under Free Speech. Truth Publishing LLC takes sole responsibility for all content. Truth Publishing sells no hard products and earns no money from the recommendation of products. is presented for educational and commentary purposes only and should not be construed as professional advice from any licensed practitioner. Truth Publishing assumes no responsibility for the use or misuse of this material. For the full terms of usage of this material, visit