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Peter Schiff: No Rate Hike Bad for Economy, Good for Gold, But Game Changer Coming

Tuesday, September 22, 2015 13:56

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(Before It's News)

CNN’s Futures Now host, Jackie DeAngelis, begins her report by saying, “Ask, and you shall receive,” referring to people wanting to hear from Peter Schiff. Somewhat kiddingly, Jackie’s first question to Peter is, “Are you ready to take a victory lap again?”Peter immediately deflects by pivoting to what many of us have been saying all along. Peter replies by saying it’s not that he was “right” about the Fed’s decision to raise rates or keep them the same, because there never really WAS a “decision” to be made by the Fed in the first place. It was all a bluff.

There wasn’t NEVER a snowball’s chance in hell rates COULD be raised. How can we say that for sure? Because the HINT of raising rates not by 1.5%, not 1.25%, not 1%, but a mere .25% sent markets REELING down 2,000 points. Anyone who believed there was a chance the Fed would raise rates was a fool. Of course the next logical question Jackie asks, is does Peter expect the Fed to raise rates at their next meeting, or maybe later this year? All I’ll say is if you were someone who thought the Fed would raise rates, LISTEN to Peter’s answer and make better decisions next time!

UNBELIEVABLY, Scott Nations (the other guest that no one was demanding to hear from) asks Peter the DUMBEST question on earth. He asks, “What made YOU so certain the Fed would not and will not raise rates?” REALLY? For anyone reading this, see my answer several lines up. It’s not rocket science. Then listen to Peter tee off on Scott Nations for TOTALLY missing the boat. After Peter answers, Scott doubles down and asks an even dumber question, and begins it with, “Why does everyone else say… but only you say….” ARE YOU KIDDING?

First of all… go back as far as 2006. How often has “everyone else been right,” and how often has Peter been right? HINT: Check out the book, Crash Proof: How to Profit From the Coming Economic Collapse, which Peter wrote in 2006 predicting the 2008 crash down to a gnat’s a**. Everyone was laughing at Peter back then too. They weren’t laughing anymore by 2009 I can assure you.

These Ivy league economists overcomplicate everything to the point that ordinary people think they are experts, but they are just talking mumbo jumbo. If YOU are a layman, and don’t have a firm understanding of economics, I suggest you buy, How an Economy Grows and Why It Crashes. It’s written at a third grade level and can be read in a day. You’ll know more about economics that ANY of these Keynesian economists.

Finally, Peter’s analysis ends with his predictions in the currency market. Peter says to expect a GAME CHANGER. Find out what he is talking about…

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Market Daily News Reports:

JT Long: The much-anticipated decision by the Federal Reserve Board at the Sept. 17 meeting to hold interest rates near zero was met in the resource community with a mixture of relief and disappointment.

The 9-to-1 vote citing global economic pressure on inflation left open the possibility of a hike at the December meeting.

The Gold Report asked the experts in the resource sector what this means for precious metals and oil prices, and what signs they are looking for that a different outcome will be announced in December.

Joe McAlinden, founder of McAlinden Research Partners and former chief global strategist with Morgan Stanley Investment Management, was disappointed that the Fed “blinked.” He called the decision irresponsible and attributed it to worries about China’s growth. The veteran investor saw the status quo as bullish for precious metals and oil, but warned, “As the Fed continues to postpone moving towards normalization of interest rates, the potential for future inflation from years of excessive stimulation increases with every delay of the end of the zero interest rate policy.”

He continued, “Based on today’s decision, we now need to watch economic data from China and the performance of the markets themselves. I do not believe that the Fed’s focus on those points is appropriate. Nonetheless, it is now clear that these will influence the timing of the next Fed move. Also, and more appropriately, we should be watching average hourly earnings, overall signs of strength or weakness in the U.S. economy, and the trend of the core PCE deflator.”

Frank Holmes, CEO and chief investment officer at U.S. Global Investors, called the decision combined with recent negative global Purchasing Managers Index (PMI) (51.10 for August compared to 52.7 in July) “a wash” for precious metals, oil and gas prices, as an increase would have increased the strength of the dollar compared with other currencies and accelerated an economic slowdown. He saw the inevitable decision coming, however, and used it as an opportunity to buy 2-year bonds in the lead up to the meeting. Shortly after the announcement, bond yields began to fall and prices went up.

From the Precious Metals Summit in Beaver Creek where he was speaking about global trends, he blamed China’s blue skies, a smog clearing brought on by a lack of manufacturing output. “I anticipate a resurgence of exports as the renminbi becomes more competitive with the dollar,” he said. He will be watching the October and November PMI numbers for an increase in economic activity, which will be positive indicators for the love trade—gold as gifts and jewelry in China and India—and growth commodities—copper, oil and gas.

ShadowStats’ Publisher John Williams was expecting the Fed to raise interest rates, as he said in an interview with The Gold Report the first week of September, “to begin restoring some sense of normalcy in the monetary system.” The decision not to make even a token move up could be cause for concern, he warned. “Market concerns should shift now to looking at what circumstances really are scaring the Fed.

The dynamics of intensifying shifts in global perceptions of U.S. economic activity and U.S. systemic stability rapidly should gain dominance over Fed policy in driving the U.S. currency and equity markets, irrespective of future Fed actions or lack of same,” he said in a note to subscribers moments after the announcement.

When asked for his reaction, John Mauldin, the man behind Mauldin Economics and author of “Bull’s Eye Investing: Targeting Real Returns in a Smoke and Mirrors Market,” quoted Peter Boockvar, managing director of The Lindsey Group, who lamented that because the Fed had punted again, we are all in for another six weeks of obsessing over when it will happen.

“The Fed is implicitly acknowledging that its policy action over the past five years of putting the U.S. economy on a sustainable growth path has been a failure and now if their international concerns become more pronounced, they will also admit to the world that they have no tools to deal with it. I think today’s decision was a bad one. The dollar rally should be over and I’m bullish on precious metals (again), as I don’t understand at all what the bear case is in it anymore.

Other commodities should benefit too from the weak dollar. Be cautious, the Fed did more damage to its credibility today.”

So what do you think?

This article is brought to you courtesy of JT Long.

Read the article here at Market Daily News:

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