Peter Schiff: People Will Be Wiped Out By the Inflation Tax


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May 20, 2020 by SchiffGold 0 3

The printing presses are running at full speed as the Federal Reserve produces cash out of thin air at an extraordinary rate. Peter Schiff just recently appeared on Kitco News to talk about the impact of all money-printing, loaning and government spending. Someone has to spend for this and all of us will. A lot of people will be wiped out by the inflation tax.

US stock markets have typically been increasing despite disappointing economic data. Any optimistic news about coronavirus, such as the current promising vaccine trials sends stocks up. Peter said he believes people are looking for an excuse to purchase, but what’s really driving stocks is the Federal Reserve.

Powell on 60 Minutes [Sunday] night basically committing to print an unlimited amount of money and prompting Congress to borrow and invest as much cash as they want and that the Fed is standing ready to generate income from an infinite quantity of government spending. I believe individuals think that’s good for the market however it’s not. It’s a disaster for the economy. It will destroy the worth of the dollar. And sure, that indicates stocks will go up, however so what, if you’re pricing them in worthless currency?”

Peter said that there is a limit to how much money the Fed can print.

That’s when it collapses in value. What’s the point of printing money that doesn’t buy anything?

So what should the Fed do? Peter stated if the reserve bank had actually been doing the right thing the whole time, the economy would have been strong enough to hold up against the pandemic and do what it actually requires to do — significantly decrease government spending. The issue now is nobody has any money. Everyone is broke and leverage to the hilt since the Fed has made one mistake after another to pump up one bubble after another.

This specific bubble was already deflating prior to the coronavirus pin put a gaping hole in it. And now the air is coming out much faster and all they can think about is how can we fill it back up again? How can we reflate a bubble? And it’s going to be difficult.”

Ultimately, the Federal Reserve will destroy the dollar.

The thing people actually need to be immunized from is the massive inflation that the Fed is going to let loose.”

Peter said the dollar is currently levitating and once it starts to truly fall, it is going to implode. However a great deal of mainstream experts firmly insist inflation isn’t a problem After all, CPI is low. As Peter pointed out, the level of inflation right now is extraordinary. Inflation, by meaning, is the expansion of the money supply and it grew at a record rate in April

Inflation is a tax and it’s the most vicious tax since it hits the most vulnerable. It strikes the lower class, the working poor, people who have savings. It ruins the value of a life time of cost savings. It ruins the value of the earnings and salaries that individuals make.”

Peter stated we will see cost inflation that gets the levels we saw in the 1970 s. We might even possibly see run-away inflation.

So, where should financiers be going? Peter said gold is a safe haven therefore is silver As far as speculative cash, Peter stated mining stocks provide the very best risk-reward.

I believe many people are going to get eliminated with the inflation tax. All of this federal government is not complimentary. This unbelievable increase in the size of federal government is going to cost somebody. Somebody needs to foot the bill for all the bailouts and all the stimulus. And if we’re not raising taxes, then how are we doing it? We’re financing it through inflation. And that does not indicate we get it for free. It simply implies that anybody who is absurd enough to hold US dollars, either in savings or in the kind of bonds or other fixed-income financial investments, or even any income-oriented financial investments where the income is US dollars– you are going to suffer.”

And how do you avoid the suffering? Get rid of the dollars.

Use them to build up real money– gold and silver.”

All currencies are declining today and you can see that in regards to gold. Gold has reached record highs in nearly every major currency except the dollar.

I think the dollar is going to win the race to the bottom, which is a race you don’t want to win. I think as soon as we take the lead in that race, that’s when you’re really going to begin to see the gold rate moving. Since gold does a lot much better when the dollar is the weakest of the currencies. If gold is this strong when the dollar is less weak than its competitors, envision how much stronger it’s going to be when it’s the weakest one.”

Peter said ultimately he thinks the dollar will lose its status as the reserve currency and the world will go back to gold as the main monetary reserve.

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