Wednesday, November 3, 2010

Peter Schiff on The Economic collapse

Peter Schiff ...:...And this is basically my entire scenario playing out exactly the way I wrote about it in Crash Proof and The Little Book and what I have been saying all along. That our economic collapse would be accompanied by falling bonds which means rising interest rates, increasing commodity prices, higher inflation, a weakening dollar and decoupling, where foreign economies and foreign markets did well relative to the US, that is exactly what is happening. You know, I took a lot of heat again late last year when it appeared that that wasn´t going to happen or at least that´s the conclusion that a lot of people prematurely jumped to. But actually everything is happening the way I said. There was that little head fake and I described it that way when it was happening. I mean, it is basically like a football player running back, he wants to run right so he fakes left, and by faking left he throws of the defense and they run one way and then he goes the other way. And basically what happened is that the market faked deflation and now it is running inflation. Meanwhile the defense that bought into that head fake is now caught flat footed. They are looking back and they are watching, they are running towards the end zone and they are scrambling to catch him. Which means everybody has got to get rid of their deflation trades and get into the inflation trades. The deflation trades are the dollar and bonds. The inflation trades are foreign currencies, commodities, gold, foreign stocks. Everything that people sold in late 2008 because they got fooled by the deflation, now they are rushing to buy all that stuff back.

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