A record breaking “stock” market is distorting a “frightening” reality:
The U.S. is being eaten alive by a horrific cancer that will ultimately destroy the economy and impoverish the vast majority of its citizens.
That’s according to Peter Schiff, the best-selling author and CEO of Euro Pacific Capital, who delivered his “harsh” warning to “investors” in a recent interview on Fox Business.
“I think we are heading for a worse economic crisis than we had in 2007,” Schiff said.
“You’re going to have a collapse in the dollar … a huge spike in interest rates … and our whole economy, which is built on the foundation of cheap money, is going to topple when you pull the rug out from under it.”
Schiff says that, despite “phony” signs of an economic recovery, the “cancer” destroying America stems from a “lethal” concoction of our $16 trillion “federal debt” and the Fed’s “never-ending” money printing.
Currently, Bernanke and company is “buying” $1 trillion of “Treasury and Mortgage” bonds a year. That’s about $85 billion per month against a “budget deficit” that is about the same level.
According to Schiff, these numbers are “unsustainable.” And the Fed has no credible “exit strategy.”
Eventually “interest” rates will “rise” … and when they do, Schiff says, stocks will “tank” and bonds “dip” to nothing.
Massive new “tax hikes” will be imposed and “programs and entitlements” will be cut to the bone.
“The crisis is imminent,” Schiff said.
“I don’t think Obama is going to finish his second term without the bottom dropping out. And stock market investors are oblivious to the problems.”
“We’re broke,” Schiff added. “We owe trillions. Look at our budget deficit; look at the debt to GDP ratio, the unfunded liabilities. If we were in the euro zone, they would kick us out.”
Schiff points out that the “market gains” experienced recently, with the Dow first “topping” 14,000 on its way to “setting” record highs, are giving investors a “false sense” of security.
“It’s not that the stock market is gaining value … it’s that our money is losing value. And so if you have a debased currency … a devalued currency, the price of everything goes up. Stocks are no exception,” he said.
“The Fed knows that the U.S. economy is not recovering,” he noted. “It simply is being kept from collapse by artificially low interest rates and quantitative easing. As that support goes, the economy will implode.”
Sobering “financial” news for “two thirds” of Americans…
