Peter Schiff, president of Euro Pacific Capital, is quite bearish on the United States economy and called it a “disaster” in an interview this week with the Epoch Times. He explained that people think the U.S. is in a jobless recovery but in fact there is no recovery at all. Instead, says Schiff, “the country is getting sicker.”
“The U.S. economy is really all screwed up. It’s the result of mainly monetary policy, but fiscal and regulatory policies are part of the problem. I think the major part of the problem is the central bank,” said Schiff. “The central bank is basically trying to accommodate bad fiscal policy, bad regulatory policy. They are trying to provide a stimulus to the economy to negate the sedative that is being applied by the government. But it’s actually making the problem worse.”
What exactly is causing the problem then? According to Schiff, the issues lie in the fact that interest rates are too low, the country spends too much and saves too little and the U.S. doesn’t produce enough. Instead of enhancing productivity, the nation imports goods and there is a lack of investment in production.
“We are not producing the goods. But all this is done to try to maintain the illusion of health, so Americans can keep on spending,” stated Schiff. “So politicians can actually pretend the economy is getting better. But all we are doing is actually covering up the symptoms. Beneath the surface, the economy is actually deteriorating. Eventually it’s going to collapse.”
In the end, the stock market is in a bubble and the economy is unable to experience genuine growth.
“It doesn’t feel like an economic recovery to the average American, because it’s not. We are not getting the type of prosperity that would come from real economic growth; we are just getting a bubble,” noted Schiff.