The Peter Schiff Show Podcast

RATE AND REVIEW this podcast on Facebook https://www.facebook.com/PeterSchiff/reviews/ Fed Responsible for Most Recent Move Up I think what's really responsible for this most recent move up is the Fed comments.  Now maybe Trump can take credit for those, maybe President Trump was able to get Jerome Powell's mind right after all, when it comes to rate hikes, although, if you look at the coverage from Jackson Hole, most people think that Powell stood strong and was resisting the calls from Trump to go easy on rate hikes and he was standing by the Fed's commitment to raising rates.  But that was not really what was said. Not just by Powell, but by other Fed officials who were there who were giving interviews from Jackson Hole. 2% Today Is Not the Same Thing as 2% in the 1990's To me it was clear, and I mentioned this on my previous podcast about the Fed being willing to let the inflation genie out of the bottle, that the Fed is basically back-tracking on rate hikes that the markets may have anticipated for 2019, by talking about how interest rates are closer to normal now.  That 2% today is not the same thing as 2% in the 1990's, not wanting to invert the yield curve, waiting for the whites of inflation's eyes before they actually come out blasting by doing everything that it takes. Pound of Cure Beats an Ounce of Prevention I think that the Fed has basically said we are going to sit back, we're not going to be pre-emptive on inflation fighting, we don't think inflation is going to break out, but if we're wrong, then we'll do whatever it takes. Basically the Fed's new attitude is, "Why take an ounce of prevention when you can always use a pound of cure?" Because when it comes to inflation, that ounce of prevention, given how frail the economy actually is and what a big bubble we have, that ounce of prevention could be lethal so let's just forget about that.  Somehow we're going to be able to slam the economy with a pound of cure, we're going to be able to get aggressive on fighting inflation if for some reason it ends up being much worse than we thought.  Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

RATE AND REVIEW this podcast on Facebook https://www.facebook.com/PeterSchiff/reviews/ Dovish Speech Given by Jerome Powell The catalyst for the rise in gold and the decline in the dollar, I believe, was the dovish speech given by Jerome Powell today in Jackson Hole. Whether or not the speech is perceived as dovishly as I believe it is, I think we're going to have to see if we are going to get some follow through in the dollar and in the gold market next week. It is critical to see how the markets follow through to today's actions. If I'm right, we could see a big move up in the price of gold next week and a big move down in the dollar. Hedge Funds Are Net Short Gold Remember we've got a lot of people who are short gold now for the first time since 2001, the hedge funds were net short gold and I think they could get caught in a losing trade and have to scramble to buy back the gold that they sold. Also, lots of people are now loaded up long the dollar, short the emerging market currencies.  But the impetus for this trade, the momentum, had to do with the bullish posture of the Fed and the anticipation that the Fed will continue to raise interest rates and shrink its balance sheet. Second-Guessing Assumptions But if what Jerome Powell said today causes traders to second guess those assumptions and maybe dial back their expectations for rate hikes - maybe not necessarily the 2 rate hikes that everybody believes are coming in the balance of 2018 - but potentially the idea that there may be no rate hikes at all coming in 2019, that 2018 may be the end of it. In fact, maybe, we won't even get the December rate hike.  I think to the extent the traders start to re-price the odds of future rate hikes this could be a big move in the dollar, a big move in gold and again, we have got to see what happens, because maybe this was a one day event… maybe traders are not going to read into Powells comments what I think he meant. But, given the reaction that we had today, I think there is a reasonable chance that that is exactly the way the markets are going to take it. We have so many people on the wrong side of this trade right now that it's a perfect time for the market to swing the other way.  Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

RATE AND REVIEW this podcast on Facebook. https://www.facebook.com/PeterSchiff/reviews/ Trump Suffers Huge Double Blow Yesterday, two key people - one the President's former campaign manager Paul Manafort was convicted of multiple counts of serious financial crimes, and later that day, Michael Cohen, the President's personal attorney, copped a plea to multiple financial crimes. So you have two key figures in Trump's campaign who are not criminals. Violation of Campaign Finance Laws Now, obviously, the President has not admitted to a crime, he has not been convicted of a crime, but still - guilt by association. The most problematic, at least thus far, is the fact that one of the crimes that Micheal Cohen pled guilty to had to do with violation of campaign finance laws. He made two large payments ($100,000+) to two women, one was a porn star and one was an ex-Playboy playmate. Both of these women claimed that they had had affairs with Donald Trump. In order to buy their silence, to pay them off, Donald Trump funneled some money, through Michael Cohen, to these two women. Trump's Original Story Doesn't Make Sense Of course, Donald Trump claims that he knew nothing about it - that Michael Cohen just decided on his own to make these payments and Donald Trump didn't even know about it. That was his original story until he changed his story and said he found out about it later. Although, they even have a tape recording of Donald Trump and Michael Cohen discussing how to make the payments before they were made. Guilt By Association Of course, Trump's version of the story doesn't make sense. But now Michael Cohen, as part of his plea, said that the payments that he made were made at the direction of the President. Donald Trump asked him to make the payments, he made the payments, and he has now pled guilty to the crime of making those payments. So if it was criminal for Michael Cohen to pay off these women the way he did, well then obviously the President conspired to commit that crime.  Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

RATE AND REVIEW this podcast on Facebook. https://www.facebook.com/PeterSchiff/reviews/ Strong Dollar Policy? There used to be a lot of talk about the so-called Strong Dollar Policy. We had the Strong Dollar Policy when Bill Clinton was President, George Bush; I guess when Barack Obama was President, as well.  I've talked about it, I've written about it in Crash Proof, How to Profit from the Coming Economic Collapse; I talked about it like it was the Loch Ness monster.  Everybody knows about it, everybody's heard about it but no one has actually seen it. We Like the Strong Dollar. A Strong Dollar is Good for America We didn't actually have an official policy that constituted the strong dollar policy.  It was simply talking about the strong dollar being in the national interest, and that was just the mantra that was repeated often by the Secretary of the Treasury or by the President. "We like the strong dollar. A strong dollar is good for America… and that pretty much constituted the policy. The Trend Was Your Friend But nonetheless, having the belief that there was some kind of hidden strong dollar policy helped to create confidence in the dollar, even in periods of time when the dollar was declining. Perhaps it would have declined even more had it not been for the belief that there was some kind of strong dollar policy. And of course, when the dollar was rising, the "strong dollar policy" really helped add fuel to the increase because after all, you were riding the policy.  So the dollar was going up and that was what the U.S. government wanted, so it was all good. The trend was your friend. Donald Trump's Weak Dollar Policy Well, it should be obvious that Donald Trump has a weak dollar policy, whether he wants to name it or not, that's the policy. Of course, the weak dollar policy will not involve actually doing anything, just as the strong dollar policy didn't involve doing anything, but I think the rhetoric will have the same impact in that when the dollar finally starts to fall, it will fall even faster when people think it's a deliberate policy.Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

The Accountable Capitalism Act Elizabeth Warren unveiled her new idea in an op-ed in the Wall Street Journal.  It is her new bill, called the Accountable Capitalism Act.  Of course, I have said this before, there is no truth in advertising when it comes to legislation. Whenever Congress passes a bill, the name of the bill is generally the opposite of what the bill actually does. So if they pass a bill called, "Tax Simplification", that means that they just complicated the tax code. But nobody wants to vote for a bill that's called "Tax Complication", so you can't label it "Tax Complication" when that's what we're doing, so you label it Simplification so everybody will like it. This is All About Socialism That's what Elizabeth Warren is doing in her Accountable Capitalism Act.  This is not about Capitalism. This is about Socialism. The idea here is that Capitalism is not accountable, and so this act is going to hold Capitalism accountable. In reality, capitalism holds everybody accountable. Under a Capitalist system, everybody is accountable for their own actions.  If you screw up, then you have to suffer the consequences. If you make a mistake, it's on you.  If your business fails, there's not bail-out. Capitalism is the Ultimate in Accountability So Capitalism is the ultimate in accountability. It's fair and everybody is held accountable for their own decisions and their own actions.  What Elizabeth Warren wants to do is to take that accountability away.  She wants to have the government get in there and take away the accountability inherent in the Capitalist system. The Socialist Un-Accountability Act Not only is the act mislabeled, it is actually the Socialist Un-Accountability Act. It wants to take people who would normally be accountable and make them unaccountable. It's all Socialism wrapped up in a Capitalist bow. What she wants to do is: * She wants to force corporations with over $1 billion in revenue, regardless of their profit, to appoint at least 40% of their board from the ranks of their workers * She wants to re-install the stakeholder accountability that existed until the 1980's Warren: Profits have Screwed Up the Country I read the op-ed and I listened to her interview with Kramer on CNBC and according to Elizabeth Warren's revisionist version of American History, corporations cared about their stakeholders, meaning their employees, customers, communities up until the 1980's. Then all of a sudden, in the 1980's, everything changed. All of a sudden, it was all about profits. It was all about maximizing shareholder value.  And that's what screwed up the country.,Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

RATE AND REVIEW this podcast wherever you listen. https://itunes.apple.com/us/podcast/the-peter-schiff-show-podcast/id404963432?mt=2&ls=1 Turkey's Current Account Deficit The "Turkey baste" continued on Monday, although Tuesday we did have a bit of a reversal, Tuesday bounce in the lira, rising about 7 percent or so, in today's trading.  But still, it is down considerably from where it was a few weeks - a few months ago. But I do believe that the financial media is exaggerating the problems that existed in Turkey prior to the crisis reaching the headlines.  Yes, Turkey has a current account deficit, but the current account deficit is not nearly as large as the media is making it out to be.  In fact, it is similar in size to the current account deficit that the United States is running, if you look it as a percentage of GDP. In fact, Turkey's trade deficit is a much smaller percentage of its GDP than is the American trade deficit. Dollar Strength Hurting Emerging Markets The problem in Turkey is twofold:  one is the strengthening dollar, which is putting pressure on all of the emerging markets' currencies and economies. It's just that Turkey was a weaker link in that chain, so Turkey is being disproportionately impacted by the outlook that the dollar is going to keep rising. This puts a lot of pressure on economies where there has been a lot of foreign investment. A lot of loans are in dollars.  A lot of the money that has been coming into the Turkish economy has been private investment, fueling capital investment within the Turkish economy. It 's not the government borrowing all this money; it's businesses borrowing money. The international community was willing to lend.  After all, interest rates were really low for a long period of time and so capital was chasing a higher yield and some of that capital went into emerging markets, including Turkey. But obviously, you have a lot of loans that are dollar denominated and that's one reason that a rising dollar is so bad for emerging market economies. Erdogan's Populist Policies Critical of High Interest Rates What really elevated the problem for Turkey was not simply that the currency was falling, but look at what President Erdogan was saying: he is a populist leader who is saying things that appeal to voters. He's also appealing to nationalism. Trying to make it "Turkey against the world". Pursuing policies that put Turkish interests first. He has been critical of the Central Bank raising interest rates.  He has been particularly critical of the whole concept of raising interest rates.Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

RATE AND REVIEW this podcast wherever you listen. Turkey is the Epicenter of Emerging Market Concerns Right now, the epicenter of the concerns about the emerging markets is coming from Turkey. What is the problem with the Turkish lira?  Turkish President Erdogan is veering off into some very dangerous territory with his stance with the Central Bank of Turkey and now the political battle of egos that he is having with President Trump over the release of an American pastor who is imprisoned in Turkey. As a result of this, the President is now turning up the heat on Turkey with sanctions, which is compounding Turkey's problems.  Today was probably the biggest one day drop in the Turkish lira.  Today, the Turkish lira might have been down about 20% intra day. Trump Doubling Down on Tariffs with Turkey Throwing fuel on the fire, early in the morning, when the lira was already down 12%, Trump announced that he would be doubling the existing tariffs on Turkish steel and aluminum. Turkey has a trade surplus with the U.S. like just about everybody else.  Is this going to hurt Turkey?  A little bit. Obviously it hurts Americans more because now Turkish steel is that much more expensive. Speculative Frenzy Shorting the Turkish Lira All of this is adding fuel to the speculative frenzy to short the Turkish lira. I think you have a lot of hot speculative money that has been leaning down on that currency. It is basically fueling an even bigger problem.  They have high inflation, they have very high bond yields. The yields in Turkey up until recently, even though inflation was high, you had 400-500 basis points of positive bond yields. Turkish Economy Essentially Strong The Turkish economy has actually been quite strong over the years. As a result of that a lot of international money has been invested in Turkey. Foreign direct investment has been going into the Turkish economy, participating in the Turkish equity market, lenders have been loaning money.  Some of that debt of course, is dollar denominated and euro denominated which is the problem now, because if you are a company generating revenue in Turkish lira, if you have dollar or euro debt. Now a lot of people hedge; if your obligations are in a different currency, you would hedge that currency to the lira. But the weakness in the lira drives inflation even higher, because  as the lira loses value, you need more lira to buy stuff and as inflation goes higher, there is more pressure on the central bank to raise interest rates to try to fight that inflation. But higher rates also feed into inflation by increasing costs. Turkish Debt to GDP Much Lower than in the U.S. President Erdogan is putting pressure on the central bank not to raise interest rates high enough to crush all the speculators who are shorting the Turkish lira. What also should be done is they should dramatically reduce government spending in Turkey. Not that it was out of control to begin with, but they want to make sure they don't have deficits.  If you look at the debt to GDP in Turkey it is considerably lower than in the U.S. The U.S. Dollar is Not the Subject of a Run - Yet The U.S. is in far worse shape than in Turkey, in fact it's not even close.  But the difference is the U.S. dollar is not the subject of a run right now. But if you think about the predicament that Turkey is in, this is the same predicament that the U.S. is going to be in - we're just not there yet.  Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

RATE AND REVIEW This Podcast https://itunes.apple.com/us/podcast/the-peter-schiff-show-podcast/id404963432?mt=2&ls=1 Alex Jones  Banned Alex Jones was banned from iTunes, Facebook, YouTube - his entire YouTube Channel is gone! He had over a million subscribers.  The Alex Jones videos on my YouTube channel where I appeared as a guest are still up, but the ones on Alex's site are no longer there. What About the First Amendment? This raises a lot of very interesting and disturbing questions. First of all, you have a lot of people talking about censorship. What about the first amendment?  The most important thing to remember about freedom of speech is that all of that has to do with government. Government cannot infringe on your freedom of speech. This has nothing to do with a private business. So, Facebook or YouTube are private companies. I don't have a right to have a YouTube channel.  When you sign up for YouTube, they have the terms & conditions and you agree... YouTube doesn't charge me to have a YouTube channel; I don't have a right to demand one - it's private property. I can still do videos and get them out on this website and on other channels. I can listen to the Alex Jones Show podcast, even though it is not on iTunes. Banning an Opinion I don't think YouTube and Facebook taking Alex Jones off is a First Amendment issue, or is censorship.  It certainly is a double standard.  Why are Alex Jones' videos being taken down? Supposedly because it is hate speech or fake news. It is his opinion, and if you don't want to listen to it, don't. I don't think he is out there inciting violence.  There are actually sites on YouTube and Facebook that do advocate violence.  There are Communist YouTube channels.  Why is that allowed on YouTube? What is Communism?  That is where the government forcibly steals private property. Communism is a much bigger threat to the families in Newtown than Alex Jones denying that there was a shooting there. Intolerance for Any Opinion that Disagrees The Alex Jones channel made a lot of money for YouTube. Why would they want to get rid of it? YouTube is about selling ads and they need content, and Alex Jones some very good content. I think the reason was pressure from advertisers who were getting pressure from consumers saying. 'We're not going to use your products if you keep selling ads on this channel." This is the type of society we live in, where the left is so intolerant of any opinion that they disagree with that they will do anything they can to shut it down. Whether it is trying to use the power of government or trying to use their power as consumers to organize and put pressure on companies to silence people who are saying things they don't like. Slanting Content Invites Fairer Competition As long as it is not the government silencing free speech, the message is still out there. Alex Jones will still be out there, just not on YouTube, Facebook or iTunes. Ultimately, if places like Facebook or YouTube started to censor enough people, it would destroy the value of their franchise. If they slant their content it leaves the door open for a competitor to come in and offer free speech. Where you see massive hypocrisy is the same people who are up in arms about a small bakery who does not want to decorate a cake for a gay wedding and use the full force of the U.S. government to force them to so something they disagree with, have no problem with a trillion dollar company (Apple) denying service to Alex Jones because they don't agree with what he is saying. You either defend private property and liberty or you don't. I don't think we can force a baker to bake a cake for a gay wedding and we can't force YouTube to provide service to Alex Jones. Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

RATE AND REVIEW this podcast Wherever you listen. https://itunes.apple.com/us/podcast/the-peter-schiff-show-podcast/id404963432?mt=2&ls=1 Ridiculous Rhetoric in Tariffs One of the drivers behind the increasing cost of living is going to be the tariffs.  The rhetoric here is really ridiculous.  Talking heads on the mainstream media say, "We've got China by the balls..." "We're going to make them feel some pain..." "They're going to give in..."  We're going to force them to play fair because they have so much to lose..." We Have More to Lose and China Has More to Gain The reason that the Chinese stock market is suffering more than the American stock market is because investors are clueless. They believe all the nonsense that China is going to lose the trade war and America is going to win. It couldn't be further from the truth. We have a lot more to lose, in fact China has a lot to gain, if they would only figure it out. Why have the Chinese for so long been willing to subsidize the U.S. economy? That is what they have been doing.  They have been artificially suppressing the standard of living of their own people so they can prop up the standard of living in America. They have been denying their own citizens the production they otherwise would have been entitled to by diverting that production to exports. Economists Made Same Faulty Analysis After WWII This is the same type of argument that economists made, and I pointed this out on my first book, Crash Proof: The Second World War was nearing an end.  There were economists who were worried  that the end of the war would bring about a recession because there would be lots of unemployment. All of the factories that were producing military products wouldn't have anything to make anymore. And all the soldiers and factory workers would be unemployed. Everybody was worried that there would be a big economic downturn. U.S. Postwar Economy Boomed Because the Government Dramatically Cut Spending Fortunately nobody took the advice of those economists.  We ended the war anyway and rather than an economic downturn, we had an economic boom. In fact, you hear all these economists today who like to say that WWII got us out of the Great Depression. That's not correct. Yes, the GDP went up during the war because of all the military production, but if you look at the standard of living of American citizens during the war, compared to that of the post-war era, it was when the war ended that the economy boomed. Why?  Because the government dramatically cut spending.  Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy

RATE AND REVIEW this podcast on Facebook! https://www.facebook.com/PeterSchiff/reviews/ Abolish the Capital Gains Tax? If we simply had no capital gains tax, but wen are still taxing the worker on the value of his labor without any deductions whatsoever, I just don't think that's a fair system. That's one of the reasons I would not want to just abolish the capital gains tax. I would want to abolish the entire income tax and go to an indirect tax, such as sales tax or tariffs.  We would obviously have a much smaller government if it had to survive on indirect taxes, on excise taxes. This is what the framers of the  (of the Constitution) originally envisioned.  They thought that direct taxes, like an income tax, would only be used during times of war. That's why they made it so hard to enact. Indirect Tax Rather than Direct Tax During peacetime, the government was supposed to operate on excise taxes.  Of course, the whole idea of income tax to me is inconsistent with free people. Free people do not have to report everything to the government.  They don't have to fill out paperwork under penalty of perjury and file all these tax returns, keep all these records.  If the government is forcing us to do all this, the government is the master and the people are the servants. That is not what America is supposed to be about. Is Government the Master and We the Servants? Of course, the biggest problem I have with the capital gains tax cut is that government spending is not also being cut. So we're talking about another tax cut without reducing the size of government. Since government spending needs to be paid for, if we're going to cut the capital gains tax, how are we going to pay for government spending that capital gains taxes used to pay for? Obviously we are going to borrow it. And borrowed money is going to do more damage to the economy than any benefit we get from reducing the capital gains tax.    Our Sponsors:* Check out FRE and use my code LISTEN20 for a great deal: https://frepouch.com* Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD* Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.comPrivacy & Opt-Out: https://redcircle.com/privacy