{"id":1500517,"date":"2024-11-05T14:05:00","date_gmt":"2024-11-05T19:05:00","guid":{"rendered":"https:\/\/bugaluu.com\/news\/?p=1500517"},"modified":"2024-11-05T14:05:00","modified_gmt":"2024-11-05T19:05:00","slug":"schiff-fed-policy-is-backfiring","status":"publish","type":"post","link":"https:\/\/bugaluu.com\/news\/schiff-fed-policy-is-backfiring\/1500517\/","title":{"rendered":"Schiff: Fed Policy Is Backfiring"},"content":{"rendered":"

Schiff: Fed Policy Is Backfiring<\/span><\/p>\n

\n

Via SchiffGold.com,<\/em><\/a><\/p>\n

Earlier this week, Peter joined\u00a0Mark Mitchell<\/a>\u00a0on his podcast for a conversation on economics and monetary policy. They dive into the economic challenges facing the United States, focusing on structural issues like inflation, debt, and currency devaluation. Peter draws attention to the overlooked surge in gold prices, contrasting it with Bitcoin\u2019s media spotlight, and discusses unrealistic promises by politicians on both sides regarding tariffs, tax cuts, and economic growth.<\/p>\n<\/p>\n

To start, Peter and Mark point out the\u00a0Fed\u2019s plan to reduce long-term interest rates has backfired<\/a>, leading said rates to rise even higher:<\/p>\n

\u201cI thought that the catalyst for the next move up in long-term rates would be the Fed reducing short-term rates. Part of the reason for this reduction in short-term rates was to try to bring down longer-term rates, particularly mortgage rates, because people are having a hard time paying these inflated home prices with normal mortgage rates. \u2026 But it backfired. <\/strong>As we\u2019re talking this morning, the yield on a 10-year treasury is now at 4.3%, which is 60 basis points higher than it was when the Fed cut rates by 50 basis points.\u201d<\/em><\/p>\n

Even 4.3% isn\u2019t high enough to flush out decades of malinvestment. Just like a fever burns out a virus, the economy needs high interest rates to properly allocate investment:<\/p>\n

\u201cArtificially low interest rates are part of the problem underlying the economy, and they are having very negative effects on the allocation of resources\u2013 malinvestments. <\/strong>This is doing damage. We\u2019re not saving enough; we\u2019re borrowing and spending too much. Part of the solution to fixing what\u2019s broken in the economy is to let interest rates go up. They actually need to be higher than they are right now. But the problem is, we have so much debt that we can\u2019t afford it.\u201d<\/em><\/p>\n

Recent jobs numbers are not optimistic,<\/a>\u00a0even though most government statistics probably understate the problems facing the economy. Peter explains that he looks at the year-over-year increase to the national debt, a metric he finds more reliable than headline statistics:<\/p>\n

\u201cThe CPI is a lie. The unemployment rate is a lie. All these government numbers are designed to create a false picture of prosperity that does not exist. <\/strong>They understate inflation, overstate growth, understate unemployment, understate the deficits. You can\u2019t believe the information that comes out of the government.\u201d<\/em><\/p>\n

The government ignores bad data, and the media ignores gold\u2019s record-setting year, choosing instead to focus on Bitcoin\u2019s mediocre performance:<\/p>\n

\u201cThey completely ignore it [gold]. Maybe because it\u2019s making a record high almost every day, so there\u2019s nothing new about it. But when gold is doing this, it\u2019s very significant. It\u2019s sending a clear signal that the Fed is making a mistake, that the rate cuts are a mistake, that inflation is going to be a lot higher.<\/strong> \u2026 I\u2019ll be watching financial news as gold hits a new high, and not only will they not discuss gold\u2019s significant new high, they\u2019ll go on and on about Bitcoin making a one-month high.\u201d<\/em><\/p>\n

Peter hopes Donald Trump wins the rapidly approaching election, but urges realistic expectations about his policies, especially because of the incentives politicians face on the campaign trail:<\/p>\n

\u201cThat\u2019s what he\u2019s promising. \u2018Just elect me, and everything\u2019s going to be great. Immediately, we\u2019re all going to be so rich; it\u2019s going to be crazy. And I\u2019m going to collect trillions from the Chinese, and, you know, it\u2019s all going to be great.\u2019 But it\u2019s not all going to be great\u2014that\u2019s the problem. And that\u2019s going to be a problem for the administration because they set the bar so high, the expectations are so high. You kind of want to under-promise and over-deliver, but it\u2019s hard to do that when you\u2019re running for office<\/strong>.\u201d<\/em><\/p>\n

How would we really make America great again? Start by slashing wasteful spending, then abolish the income tax:<\/p>\n

\u201cWe can\u2019t go back to the system we had before the income tax unless we dismantle all the programs that we now have because of the income tax, which I\u2019m all for. Get rid of Social Security, get rid of Medicare, get rid of Obamacare, shrink the government back down to its pre-1913 size. And that would really make America great again!<\/strong>\u201d<\/em><\/p>\n<\/div>\n

Tyler Durden<\/a><\/span>
\nTue, 11\/05\/2024 – 09:05<\/span><\/p>\n

\u200bhttps:\/\/www.zerohedge.com\/markets\/schiff-fed-policy-backfiring<\/a>\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"

Schiff: Fed Policy Is Backfiring Via SchiffGold.com, Earlier this week, Peter joined\u00a0Mark Mitchell\u00a0on his podcast for a conversation on economics and monetary policy. They dive…<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_feature_clip_id":0,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[1],"tags":[],"class_list":["post-1500517","post","type-post","status-publish","format-standard","hentry","category-news","wpcat-1-id"],"jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/pbimBl-6ilT","jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1500517","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/comments?post=1500517"}],"version-history":[{"count":0,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/posts\/1500517\/revisions"}],"wp:attachment":[{"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/media?parent=1500517"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/categories?post=1500517"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bugaluu.com\/news\/wp-json\/wp\/v2\/tags?post=1500517"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}