Dave Smith and Peter Schiff dissect Nancy Pelosi's baseless impeachment inquiry into Donald Trump, citing a lack of evidence despite Mueller's findings. They pivot to a dire economic forecast, arguing that phony CPI data and a $4 trillion Fed balance sheet mask a 20-30% real unemployment rate driving toward inevitable collapse. Schiff warns this crisis will empower socialists like Elizabeth Warren to nationalize industries, urging investors to flee U.S. assets for gold and silver before the dollar breaks down worse than in the 1970s. [Automatically generated summary]
Transcriber: nvidia/parakeet-tdt-0.6b-v2, sat-12l-sm, and large-v3-turbo
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Desperate Democratic Move00:15:00
Fill her up!
You are listening to the Gash Digital Network.
We need to roll back the state.
We spy on all of our own citizens.
Our prisons are flooded with nonviolent drug offenders.
If you want to know who America's next enemy is, look at who we're funding right now.
Every single one of these problems are a result of government being way too big.
What's up, everybody?
Welcome to a brand new episode of Part of the Problem.
This should be a good one.
I'm excited for this episode.
I want to start off on my own here, just talking about the news of the day, because I don't know if you've been paying attention, but there's some rather large news that's unfolding over the last 24 hours.
As JR in the WWE used to say, business just picked up.
Isn't that right?
Isn't that what JR used to say?
Business just picked up?
I don't know.
I think that was a thing.
The wrestling announcer was like, business just packed up.
And then Stone Cold Steve Austin would come out.
I don't know.
Either way, business did indeed just pick up.
Nancy Pelosi gave a press conference yesterday announcing that she is going forward with an impeachment inquiry regarding impeaching Donald Trump.
She said that the impeachment process has begun, although my understanding of the Constitution is that that requires a vote.
I could be wrong about that.
But either way, it looks like the Democrats are going ahead with the idea of impeachment.
This is, of course, something that they've been flirting with since about 30 seconds after Donald Trump got sworn in.
Talk of impeachment has plagued the Trump administration.
And the way it's happening and the way it's unfolding is, in my opinion, rather shocking.
Rather shocking.
And you would think after all the stuff I talk about about how the nature of the state and the nature of the media and how the drastically low regard that I hold all these people in.
I wouldn't be surprised anymore by some of this stuff, but I still am.
They still managed to get me.
I actually couldn't believe it.
I could not believe after all of the hype, after all of the investigations, that this is what they're moving forward with for impeachment.
Think about this.
Just think it through for a little bit.
Donald Trump has been investigated by the House and the Senate.
He's got investigations running all over the place on state levels and, of course, at the FBI and then the special counsel, the Robert Mueller investigation.
All of this investigating, none of what was found in those investigations has anything to do with what's happening with the impeachment proceedings.
It's pretty nutty.
And if Donald Trump, he's claiming that this is a presidential witch hunt.
He's been saying that for quite a while.
Just on the face of it, it would kind of seem to lean in his favor that after all of these investigations, after so much investigating, they've found nothing that they're moving forward with.
And now they're just doing it about something else.
So what's really surprising about this is what the story on its face is.
Now, the story is that Donald Trump made a phone call to the president of Ukraine and that he did something inappropriate about this.
The story is that a whistleblower, a whistleblower who's who we don't know who he is.
He went to the FBI and goes, something inappropriate happened on this phone call.
Now, this is the official story.
This isn't what we're adding to it, okay?
As of yesterday, when the Democrats decide they're moving forward with impeachment, the story is that we don't, the Democrats don't know who this whistleblower is.
According to the Washington Post and two other newspapers, the whistleblower did not have the transcript of the phone call.
Okay?
So they don't know who this guy is.
They don't have the transcript of the phone call.
And the transcript was never given to Congress by any other party.
So by their own story, the Democrats don't know what happened on this phone call.
They're going off rumors, accusations, and what's been reported in the media.
And this was enough for them to begin impeachment proceedings.
Pretty strange.
Pretty strange that that's what they would be going with.
Now, it is possible, you know, like if under normal circumstances, if I didn't know who all these people were, it might lead one to assume they know something that they're not telling the rest of us.
Because if this is what they're moving forward with, holy shit, this looks like it's going to be nothing, like it's going to blow up in their face.
So you might think, well, they probably know something else, probably something we don't know that they're not telling us.
They have information, and this is what they're going to bring up.
However, these are not normal circumstances.
And in the context we live in, where we do know who these people are, to think that they launched an entire FBI investigation with nothing, an entire special counsel investigation with nothing, you know, got FISA warrants with nothing, got all of these accusations of treason with nothing.
It's hard to not entertain the possibility that maybe they just have nothing.
Maybe they're really just going forward with impeachment and they basically have nothing.
Well, today, the plot thickened a little bit.
Donald Trump and the White House released what they call the transcript of the phone call.
Now, to be fair, it's not technically the phone call transcribed.
It is a memo that I guess White House staffers take about the phone call.
But it reads as a transcript.
So theoretically, could they be leaving something out?
Could it have been doctored?
Sure.
But they did release it.
And more or less, what this is all about is Donald Trump kind of, I mean, look, he never blatantly in the transcript.
By the way, it's really fascinating to read.
If you haven't read it, they released it.
It's on the White House's Twitter page.
They posted it.
It's out there.
Go read it.
To hear how Donald Trump talks to a foreign leader is very interesting.
You see the sharper side of Donald Trump.
You know, sometimes Donald Trump comes off like this kind of bumbling idiot, and sometimes he comes off like a cutthroat businessman who's got some savvy.
And this was more in my opinion of the latter.
But what's going on here, and the story really is quite something.
So it's about him, you could say pressuring the Ukrainian government into doing something for the money that they're getting from America.
And one of the things, amongst others, that he seems to want them to do is to look into what was going on with Joe Biden's son.
Now, what's funny about this is that it's really quite something.
I mean, you know, this characterizes the Trump administration in general, but it really, it's like something you've never seen before in politics.
The idea that a president is being impeached or impeachment proceedings are starting against a president for, as they would say, you know, using a foreign adversary to try to get dirt on his political opponent.
Really, what it is, is about the corruption of the frontrunner of the Democrats.
So, the Republican president could be impeached for trying to uncover blatant corruption by the Democratic frontrunner.
Now, this has got to be, I was going to say bittersweet, but probably just bitter for Joe Biden.
I mean, it would be bittersweet if he was the nominee already and the president's being impeached.
But when you're not even, when you don't even have the nomination sewed up, this has got to be rough because the whole thing was very interesting to watch MSNBC and CNN trying to tell this story without telling the part about Joe Biden.
So, the story is that Joe Biden's son, okay, Joe Biden's son, Hunter Biden, got a job.
Obama basically made Joe Biden the envoy to Ukraine.
Then, his son, Hunter Biden, who has no experience in the energy sector and doesn't speak the language and has no reason to be in this Ukrainian energy company, is making $600K a year from this Ukrainian energy company.
Seems likely that that was indirectly to pay off Joe Biden.
Now, Joe Biden on tape brags about the fact that he said they were going to withhold U.S. money unless the prosecutor, okay, so this company ended up getting investigated by this prosecutor in Ukraine.
And Joe Biden demanded this guy got fired.
And he bragged on tape at the Council on Foreign Relations that he was going to, that he demanded this prosecutor who was looking into this company get fired.
And if he didn't, they would be withholding U.S. money.
He bragged about this openly.
This isn't some conspiracy theory.
So the prosecutor does end up getting fired.
That investigation never moves forward.
Trump seemed to want that investigation reopened.
Trump seemed to suggest that Ukraine should communicate with the Attorney General, should communicate with Rudy Giuliani.
So, okay, so if worst case scenario, if Donald Trump is guilty of something here, Joe Biden has to be just as guilty as him.
I mean, how is it, you know, some horrific thing for Donald Trump to say, hey, we give you all this money.
I want you to reopen that investigation before we give you that money.
For Joe Biden to say, we give you all this money.
I want this investigation shut down if you want this money.
In fact, wouldn't it seem like the Joe Biden offense was far worse?
Because one person's asking you to investigate something you were already investigating, and one person's asking you to shut down an investigation because it involves his son.
Seems to me pretty obvious that that would be worse than what Trump did.
Anyway, this is, you know, I don't know.
It's hard not to speculate about things like this.
And I don't like to speculate too much.
But why would the Democrats not wait for at least a little bit more evidence to come out?
If they did have more evidence of wrongdoing, why would they keep it to themselves?
That doesn't really seem to make any sense.
What you'd want to do with an impeachment, look, you got to think about it this way, right?
Politically, the Democrats, Nancy Pelosi, has, she doesn't care about the AOCs of the world, the people who are in these districts who, you know, their base just wants you to impeach Donald Trump.
But why didn't Nancy Pelosi impeach Donald Trump way before this?
Because it's not just about people in, you know, secured Democrat districts.
She's got people in swing states, in states who voted for Donald Trump, who could be losing their seats over casting this impeachment vote if it goes bad and it's shown that they had no real evidence and no real reason.
I mean, impeachment's a pretty heavy thing to do.
It kind of tears the nation apart.
You're flirting around with unseating a democratically elected president.
Again, not that I care about democracy, but these people claim to.
And most people in this country at least claim to.
So if you were going to do that, if you were going to put these people through the situation of making them put their name down and making them vote on this stuff, I think it seems reasonable to me that what you would want to do would be to release as much information as you could to let them know, hey, people, we have a really good case here.
We're fulfilling our constitutional duty.
We're not just trying to impeach Donald Trump, which we've clearly been doing since he's been in office.
This isn't just like, oh, all these investigations failed, so we're just throwing something else at the wall.
Because that sure does seem to be what it is right now.
However, that none of that is happening, which leads me to suspect that really they don't have anything more than what we see.
I mean, look, it turned out with the whole Mueller investigation, they had nothing more than what we saw.
It turned out when, you know, when the FBI first started investigating Donald Trump before the Mueller investigation, they had, I mean, Andrew McCabe said, they said, well, what led you to investigate him?
And he goes, I don't think it was anything that you guys didn't know about or see.
You know, he fired Comey.
He said that thing about the Russians having Hillary Clinton's emails.
That.
That's what we had.
Everything you knew.
And it's like, wow, that's it.
That's what they had.
They had everything we knew.
I think right here after this transcript's been released, that's everything that they have.
That's my hunch.
And if so, man, is this going to be a tough one to sell?
I mean, I don't know.
You know, I'm no constitutional expert.
I don't know exactly if there's a gray area where you can ask another country to, you know, reopen an investigation.
I mean, sure, it happens, you know, it is against his political rival.
Maybe there's something there.
But first of all, how many people really even, how many people really even think through or ever have to defend why we should be giving Ukraine hundreds of millions of dollars in military assistance to begin with?
I mean, the funny thing about all this, right, is after all that Trump-Russia collusion, you know, the Ukraine and Russia have been involved in some tensions over the last few years.
And the idea that Donald Trump is so chummy and doing business with the Ukrainians kind of, you know, destroys the whole narrative that he's a Russian puppet, but whatever.
I guess they're off of that.
You know, like that never happened.
But it's hard to not speculate about what might be going on.
And I have heard some people speculate that with Donald Trump, that the Ukrainians knew a lot about the origins of the Russia investigation, of the phony collusion witch hunt.
And the idea that Donald Trump was maybe trying to get to the bottom of that and work out some type of deal there.
Like maybe it's nothing to do with this transcript or this phone call.
It was some other deal that they had worked out.
That just seems a little bit more plausible to me because this seems like a move of desperation from the Democrats.
How The Deep State Works00:09:47
That's what it seems like to me.
And I don't know.
It'll be interesting to see if anything comes out in that direction.
The other thing that's worth noting and is probably the more important point, the bigger picture here, is that you have Donald Trump, you know, worst case scenario being like, hey, we give you a lot of money.
I think we should get something for that money.
And this is where a whistleblower will step forward and say something really inappropriate happened here in this conversation.
This is the way the deep state works.
This is the way government accountability works in the United States of America.
Now, of course, you think about some of the things that other presidents have done.
I mean, you think about Barack Obama, who started a drone, or I shouldn't say started, but really built up the drone program, is bombing countries that we are not at war with, and was lying to the American people about it.
I mean, straight up, it's been admitted on national television that his press secretary was instructed not to answer any questions about the drone program.
They were essentially pretending it didn't exist.
I wonder what type of communications there might have been about this program to bomb sovereign nations who the Congress has not declared war against.
Nobody felt a constitutional duty to step up and say anything about that.
Nothing.
George W. Bush, with the wiretapping, with the outing of CIA agents, with instituting torture, all of these things.
No one felt the need to step up.
No one felt the need to start the impeachment process over all that.
But Donald Trump makes a phone call where he says some inappropriate things to the Ukraine.
And this is what's launching an impeachment investigation.
It is very strange and very revealing about what actually can get you in trouble in the United States federal mafia.
It is really something.
You know, this is a big risk by the Democrats.
They're going big on this one.
And we'll see.
We will see what ends up happening, what ends up coming of all of this.
But from where I'm sitting right now, this looks like this could be their most epic failure yet.
Of course, almost all of the Democratic candidates for president have all voiced their support for the impeachment.
You know, Bernie Sanders, Elizabeth Warren, Joe Biden, all of them have gotten in on this.
And it's going to be something.
It's going to be something to see what actually ends up happening with all this.
I don't know quite else what to say.
I don't know quite what to say else.
Anyway.
But this is really, this is history.
This is history that we're living through for sure.
And, you know, Joe Biden's son, of course, there was obvious shadiness going on there.
And okay, so Donald Trump wanted to look into this, wanted to investigate it.
I mean, on the bigger philosophical picture, why should we be giving these other countries money to begin with?
And why should we not ask for anything in return if we do give them all of this money?
See, it doesn't seem that unreasonable.
And I think to most people, this isn't going to seem that unreasonable.
And it doesn't seem like they're suggesting that anything criminal happened here because there's not calls to investigate Donald Trump in any criminal sense.
The calls are just for impeachment where, of course, the bar is much lower.
And you don't actually need to prove any, you know, you don't need to prove like for the standard of indicting somebody.
There's no, you're not going to go to trial where you have to prove something beyond a shadow of a doubt.
You simply have to get votes in Congress.
As many have said before, an impeachable offense is anything that Congress determines an impeachable offense to be.
Now, you may not believe that that was the original intent of the founders, or maybe you do, but in effect, that is the reality.
If you get Congress to vote with you, then you get an impeachment.
Now, of course, they know that this impeachment is not going through.
Donald Trump is not going to be removed from office from this impeachment.
I shouldn't even say not, but very, very unlikely.
And not that the Republicans wouldn't stab him in the back in a second.
I've always thought that Donald Trump is as despised by the mainstream Republicans as he is by the mainstream Democrats.
And there's a lot of evidence to back that up.
But this is still politics.
And the idea, I mean, all of these Republicans would be sacrificing their political future if they were to vote to impeach Donald Trump.
I mean, maybe one or two.
Maybe you get Mitt Romney in the Senate to vote for that because he's in Utah where there weren't ever big fans of Donald Trump, although he did carry that state.
He was polling very poorly there up until the election night.
And I think that was more a rejection of Hillary Clinton than support for Donald Trump.
And Mitt Romney is, you know, he's a Mormon.
He may be able to hold down his Mormons in Utah and vote for them.
But so many of these Republicans, you vote against Donald Trump like this.
It's, you know, you're sacrificing your political future.
So I highly doubt the Republicans would, if it made it that far, would vote to impeach Donald Trump.
So it would just be a situation where, you know, the House votes to impeach him, the Senate lets him off, much like usually happens in these situations.
But I think one of the things that's interesting to think about with all of this, and who knows exactly, but think through what this might do to the country.
I mean, if the perception is, and from my point of view, it's really not far off from the reality.
But if the perception is that basically the entire media establishment and the political establishment and the deep state establishment have been trying to oust Donald Trump from the very beginning, that they've tried several different tactics all the way back to when he was a candidate.
You know, you could talk about them flirting around with the idea of changing the rules before the Republican National Convention.
You can talk about the media holding on to that e-Hollywood access tape and then releasing it a few weeks before the election.
All these things over and over again, all the negative media attention, all of this stuff.
All of the attempts to get rid of him after he got in, I mean, in the transition process, the investigations, the attempted deep state coup, the Trump-Russia-Russia collusion thing, which completely fell apart.
You have all of these attempts to get him.
And let's just say, hypothetically, you get him on a transcript that anyone would read and go, eh, all right.
I guess maybe he shouldn't have said that.
I mean, it's far from anything like the president is a puppet of Vladimir Putin.
You know, it's nothing like what you guys always started.
This is how literally Hitler gets brought down.
But what would it mean if you were to bring down a president this way?
I mean, well over 60 million people voted for Donald Trump.
A lot of them still really like Donald Trump.
And how would this be seen?
Again, from my perspective, not far off from what it is, but how would this be seen by all the Trump supporters?
Well, you wanted this guy out forever.
You attempted over and over to rebuff the will of the American people.
And in an election year where the Democrats seem crazy and they all think he's going to win re-election, you guys go ahead and remove him without letting the American people vote on it.
I mean, if you wanted to just tear this country apart, I don't know that there's anything you could do that would be more effective than that.
And, you know, it's pretty rich.
As somebody who is not a fan of democracy, it's pretty rich to see all of these people who claim to love it so much go this route.
You know, it's like the whole thing with Trump, the Russian interference and all this, they interfered in the Democratic process.
They undermined our democracy.
Democracy this, democracy that.
Yet here we are in an election year.
I mean, not technically, but almost in the election year, in election season, for sure.
And you're going to move forward with impeachment rather than just say, well, hey, let's vote this guy out.
Donald Trump's the one who turned around and released the transcript so everybody can see what it is that he said.
And I just can't imagine.
I mean, I know there's a certain segment of the population that hates Donald Trump so much that whatever he does, they're going to be like, yeah, that was an impeachable offense.
But I don't know.
Seems like a bit of a stretch to me.
And if you wanted to push this country, you know, toward more and more division, this would be the way to do it.
It's pretty surprising to me.
I can't believe after everything they've dangled in front of the American people that this is actually the thing they're going to move forward on.
We'll see how it turns out.
We'll definitely be following it here on the show.
And we'll keep you guys updated.
I'll keep giving you my thoughts on it.
All right.
That's going to wrap my thoughts about the impeachment.
Anchoring The Economy00:15:55
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All right, let's get back into the show.
All right, guys, I'm very excited to have this guest in for the Wednesday one-on-one series.
I'd say as excited as I've ever been to have a guest on the show because this is somebody who's had a huge influence on me, who I've learned a lot from.
It is the great Peter Schiff, the CEO of Euro-Pacific Capital and the author of several great books, How an Economy Grows and Why It Crashes, Crash Proof, lots of other great ones as well.
So Mr. Peter Schiff, thank you so much for coming on.
Oh, my pleasure.
Happy to be part of your program.
So as people who listen to this show know, but I'll just retell quickly the story for you.
I was about, I guess, 2007, so it was 12 years ago.
I was first introduced to libertarianism with the Ron Paul Giuliani moment.
And I really liked that guy, Ron Paul.
And I was like, wow, he's really making some great points about the war.
And he kept talking about the free market and how the free market's going to solve all of our problems.
And it just did, I was like, this kind of goes against everything I've been taught.
And then the economy crashed.
And I was like, I got to look into what this guy's talking about.
And as I started doing research on him, you were one of the first guys that I found.
And I found this guy who had predicted with really stunning accuracy what was going to happen in the financial crisis of 2008.
And then I started reading all of your stuff along with some other free market guys and really got convinced that capitalism was the way to go.
So I owe you a debt of gratitude.
You've helped me develop my perspective on things and understand the world better.
What was it like for you being a guy who you were a successful businessman and you were a commentator on TV, but all of a sudden, kind of in the early days of YouTube being a big thing, you had all these videos going viral of everybody laughing at you as you explained to them that the subprime mortgage scheme was going to tank the economy.
What was it like to go through those days?
Well, you know, I think it was kind of frustrating, but I did enjoy the exposure that I was getting.
And at least to the credit of a lot of these networks at the time anyway, they had me on.
And so I was on quite often.
And, you know, they barely let me on now.
So I think that once a lot of my predictions came true, I think they became a little bit more reluctant to give me the airtime.
I think when I was kind of like there to provide a little comic relief maybe or just a fair and balanced counter view to the conventional wisdom, they had me on with great frequency.
But I'm rarely on these last several years or even since the financial crisis itself.
Maybe they kept me on for about another year.
But by 2010, my appearances were way, way down.
And of course, they're even fewer now.
Well, maybe when the next crash comes, they'll call you up and want to hear from you again.
I used to love those cable news appearances because it would be, you know, it reminds me of when I'll see like David Stockman will get an occasional appearance on cable news.
And it's just whatever the panel or group of people is, the way it used to be when you were on there, it was just so obvious that everybody else is just kind of regurgitating these approved talking points.
And this one guy has some real thoughts on this thing.
And it would be such an interesting contrast to watch, you know, the difference between you guys.
Let me ask you, what was it?
Why were you able to see what so many others missed?
Like, what was it in your background?
I know your father was a free market guy, so you were probably raised, you know, kind of understanding some of this stuff.
But what had you read?
What had you learned in your life that you could see the market, the bubbles developing in the market?
You know, the real question is, why couldn't everybody else see it?
It wasn't like I had any kind of special gift.
They were just completely oblivious.
And the question is, why were they so oblivious?
And a lot of it has to do with groupthink.
A lot of it has to do with the fact that when you're inside a bubble, it's very difficult to recognize the bubble.
In fact, I forget who said it, but when your financial livelihood depends on you not understanding something, you generally don't understand it.
And so that was the problem.
I mean, everybody had a vested interest in keeping the party going.
Nobody wanted to even, you know, consider that it could end.
But, you know, I was a lot more objective, I thought, as kind of an outsider.
I was, you know, I was in the financial business, but I was, you know, I had my own firm.
I wasn't part of the establishment.
So I could see it a lot more clearly and certainly had the ability to come out and say what I thought.
I think a lot of other people within the financial community might have had a feeling that I was right, but they just didn't have the ability really to come out publicly and say it because they had to toe the company line.
So I had a little bit more freedom in that I was self-employed, that I could speak my mind.
And so I was able to do it.
But I mean, it's basic understanding of economics and finance and money.
And the fact is that the 08 financial crisis, as obvious as that disaster actually was, as obvious as the housing bubble was.
And I was not only talking about it with great frequency, but I was writing about it.
And there's all sorts of articles I wrote for years and I sent them to hundreds of reporters, laying out the bubble and how, I mean, a lot of it was humorous because it was so obvious.
It was actually funny.
But people couldn't see that.
But as obvious as that was, the crisis that we're headed for now is even more apparent than that one.
But all of the people that were so complacent and oblivious leading up to the 08 crisis, the same people, have the same feeling today.
They think everything is great.
The economy is booming.
Nothing can go wrong.
The Federal Reserve is a bunch of geniuses.
They know what they're doing.
And this economy is about to hit a brick wall.
And it's a much bigger wall, much higher than the one that they didn't notice in 08 that we smashed into.
Yeah, I remember when I first found you in 2008, and it was at the time John McCain, who was the nominee of the Republican Party, he famously said, the fundamentals of the economy are strong.
And I remember hearing you in an interview respond to that.
And you said, how could the fundamentals of this economy be strong?
We have an entire economy that's based off consumer spending instead of production.
It's based off deficit financing, borrowing money from other, but the economy is inherently based off of other people making our stuff and then us borrowing money so we can buy that stuff from them.
And that just seems so common sense to me.
It was a bubble, but McCain was running on the Bush record.
He was basically the third term for Bush.
So he had to claim the economy was sound.
That was his campaign strategy.
It's unfortunate, too, that John McCain actually interrupted his campaign to go and vote for TARP.
Yeah, that's right.
And I actually would have voted for McCain had he interrupted his campaign to vote against TARP.
But because he couldn't even do that one thing, I didn't vote for him.
And I don't think I even voted in that election for president because Ron, I mean, Gary Johnson was running, but he didn't make the ballot in my state of Connecticut.
So I don't think I was, I just think I abstained.
I mean, I couldn't vote for Obama, but I couldn't vote for a guy that would vote for TARP.
So I didn't have a choice.
Did you get a Ron Paul primary vote in there?
I think so.
No, I can't remember if he was on the ballot in Connecticut or not.
I don't remember.
Yeah, there were no good options.
And truthfully speaking, even if McCain had won, we probably would have seen government spending right around the same levels as it probably would have been everything Obama did wrong, plus bombing Iran or something like that.
So the Republicans have never really offered a free market alternative.
So in the years...
Well, neither has Trump.
I mean, Trump, all the Republicans are making the same mistakes the way they embraced Bush, the way they thought we had a great economy under Bush because he cut taxes.
That was a bunch of nonsense.
We had a phony economy because the Fed cut rates.
Well, the same thing is happening under Trump.
In fact, although the Fed started out hiking rates, but the thing is they started where the rates were so low that even though they were hiking rates, there was still a massive monetary stimulus that was inflating the economy.
But then Trump was able to add fuel to that by cutting taxes.
But now the Fed is cutting rates as well.
In fact, they just went back to quantitative easing.
Now, they're not going to admit that because they're not calling it quantitative easing, but it's the exact same thing.
And so, you know, a rose by any other name, although in this case, it's not a rose because roses are good.
And this is definitely bad.
This is, you know, debt monetization and inflation.
But, you know, Trump has made the same mistakes as Bush, cut taxes, but increase government spending means bigger deficits.
And then pretend that spending that borrow money equates to a stronger economy and economic growth.
It doesn't.
It's just setting ourselves up for the next collapse, which is going to be much bigger than the one that happened under Bush.
And this time it could start in Trump's first term.
You know, Bush was able to delay the day of reckoning to his second term because the dot-com bubble wasn't really that big.
And so the Fed was able to reflate a housing bubble that was able to postpone that recession until 07, 08.
But that is why we had Obama.
But this collapse, should it begin before the 2020 election, this is going to be what gives us somebody much, much worse than Obama, potentially Elizabeth Warren, who looks like she's the frontrunner at this point.
But just imagine a Warren presidency, especially if the Democrats retake the House, which they will do.
I mean, if Warren wins the White House, there's no question that the Democrats will pick up enough seats to give the Democrats control of the executive and the legislative branches.
Yeah, it's really terrifying.
And what's really scary about it is that the narrative almost writes itself.
It's like here, look, we went with Donald Trump, this businessman, this capitalist.
He cut taxes.
Capitalism's the problem.
This is why we need the government to come in and save people, not like Obama, like really juiced the government up.
So what do you, I mean, you got your predictions right in 2006, 2007.
Is that what you see happening?
What do you think the government response will be?
I've seen that happen for a while.
In fact, I think the Democratic narrative is even better than that.
I think their whole strategy is Donald Trump inherited a great economy from Obama, right?
Because Obama fixed the economy that Bush broke.
And then he, it was great and he handed it off to Trump, who inherited all the good work, right, that Obama did.
And then like everything else that Donald Trump has inherited in his life, he squandered that great economy with tax cuts and deregulation and put us right back into the same ditch that Bush put us in.
And now we need another savior like Obama, only because now it's a bigger ditch and it's even worse.
Now we need to go with a complete overhaul of the economy.
We need to reject capitalism because this is proven.
Capitalism has now proven that it's a complete failure.
And so what we need is the opposite of capitalism.
We need socialism.
We need the government now to come in and nationalize, take over stuff and provide all this free stuff.
And we really need to get those rich people and the bankers because they're the reason that the economy is such a disaster.
And this is a perfect script.
I mean, this is what's going to happen.
And it's not good for the country.
Believe me.
Is there any way to cushion the landing in any sense?
Like if let's say we got, just in some hypothetical world, we got Peter Schiff and Ron Paul and David Stockman, a lot of people who really understand the economic situation wherein you guys got elected or you guys got in control.
I mean, it seems to me like who is his name?
Who's the Fed chairman under Reagan?
Volcker?
Volcker.
Volcker, who raised rates.
Well, you can't even do that today because of the debt that we're carrying around.
I mean, is there anything we could do?
Well, you have to do that, but then you have to default on a lot of the debt, which, you know, we have to do.
I mean, there's no easy way out of this.
A lot of people are going to lose a lot of money no matter what you do.
But there is a right way to approach this.
And there's the way we're approaching it, which is the wrong way.
But if it were up to me, the way we can ease the pain, and it's not going to be painless.
There's no way to do that, right?
It's trying to do that.
That is the reason that the problem is so big, all the years of kicking the can down the road.
In fact, even Jim Bullard was interviewed today on CNBC and he admitted, if you could read between the lines, but he said the reason he wants to cut rates is because the Fed is basically going to be powerless in the next recession.
And so we should do whatever we can to delay that recession for as long as possible.
But the problem is whatever the Fed does to delay the recession just makes that recession worse.
So rather than delay it and make it worse, let's embrace it and get it over with.
But what we could do to ease the transition is to shrink the size of the federal government so that the federal government is a smaller drag on the economy.
I mean, we are a giant weight that is anchoring the economy.
We need to lighten the load.
And so the government needs to get as small as possible by cutting as much spending as possible.
And I'm not talking about just waste, fraud, and abuse.
I'm talking about the real meat of what the government's spending on.
We've got to go to the entitlements and other agencies and just get rid of them, entire departments.
We need to really shrink government down to size because we can't afford this enormous government.
We've been borrowing the money to pay for it, but we're not going to be able to do that anymore because we need to let interest rates go up so that we can have more savings and investment.
But if interest rates go up, we can't afford to pay the debt on the money that we've already borrowed.
So that has to be defaulted on.
But if we're going to rebuild the infrastructure and the manufacturing base of this country, we can't do that and support a massive government at the same time.
So we have to make a choice.
Phony Recovery Numbers00:09:21
Do we want big government or a big economy?
Do we want economic growth and prosperity?
Or do we want to live in a welfare state, you know, where we share the misery?
We got to make those choices.
But unfortunately, none of the politicians are willing to level with the voters.
And of course, the voters at this point, after spending a lifetime in government schools, are too brainwashed to even understand the truth, even if it was told to them.
Yeah, well, that's for sure.
So during the Obama years, it seems like he did pretty much everything wrong, economically speaking.
I mean, you had the longest period.
Really, there's nothing else like it that you could compare it to.
The longest period of near zero, if not zero interest rates, record high government spending.
And even though this did keep the next recession at bay, I agree with your perspective that it's making it worse and that it's inevitable.
But even within this environment with artificially low interest rates, it seems like something's happening here where you see the populism on the right wing rise, populism, socialism on the left-wing rise.
And so many people, it seems like even while you're keeping the recession at bay, get punished with 0% interest rates.
I mean, the savers get punished.
People on fixed incomes get punished.
Everybody who experienced a recovery under Obama seems to be people who were politically connected or are playing in the Wall Street casino.
And for the regular working people, things didn't really recover.
So even if we don't, even before the crash, isn't it bad for the economy?
Oh, look, it's been bad the entire time because everything that they have done to postpone the pain has basically prevented the cure, right?
So the disease keeps getting worse.
Instead of restructuring the economy based on sounder consumption and savings and investment, we just continued to perpetuate the bubble.
And we do enrich certain segments of the economy that feed off all of the free money that the government is or the Federal Reserve is sprinkling on the banks and on Wall Street.
So people who own a lot of financial assets benefited from the inflation that the Fed was creating.
But regular people who work for a living and earn wages, they saw their cost of living rise much faster than their wages.
And they kept borrowing more and more money to make ends meet.
And so their net worth fell.
So Americans were poor as a result of that so-called recovery.
And a lot of that frustration revealed itself in the polls in 2016.
I mean, that's one of the reasons that I was so confident that Trump had a very good chance of winning.
I didn't think it was a sure thing, but I thought he was more likely to win than lose.
And I was saying that publicly because I believed that there was a lot of disgruntled people out there who didn't believe the lies they were being fed by the Obama administration or by the media or by Wall Street about this great recovery because they were living in the real world, not this fantasy world that Wall Street was living in.
And that's what happened.
I mean, Donald Trump felt their pain.
He told the truth about the phony nature of the recovery.
The unemployment numbers were phony.
The GDP numbers were phony.
We had a lousy economy, and he was going to make America great again.
And, you know, the unfortunate thing is the minute he became president, all the phony numbers were no longer phony.
The big, fat, ugly bubble became a boom.
And he basically adopted everything he criticized.
And he's now, you know, demanding that the Fed cut rates more, do more QE.
He wants to keep this whole phony economy going long enough for him to get reelected to another tournament.
By the way, you mentioned that we had record deficits under Obama.
Well, Trump has already broken those records and we're not even in an official recession yet.
Yeah, it's really, it's actually kind of hilarious.
And I don't even think Trump sees the contradiction.
But when he's out there talking about how it's the best economy in the history of the world, but this damn Fed won't put interest rates to zero.
You're like, by what, by what, you know, economic theory could that make any sense?
Even by Keynesianism, this is not how you're supposed to do it.
But also, you know, he said the economy under Obama was the worst economy ever.
And now we have the best economy ever.
But statistically, there's really not a difference.
I mean, the GDP growth under Trump is pretty much indistinguishable from the GDP growth in the second term of Obama.
Job creation is actually slower under Trump than it was under Obama.
So our real wage increases.
Yes, the unemployment rate is lower, but because it's been trending lower the whole time.
And so all we did is continue the trend that was in motion for a long time.
But when Obama was president, Trump said that's all phony.
That's all a lie.
It's a con.
It's a fraud.
Don't believe those government numbers.
Unemployment is 20%, 30%.
And now he expects us to believe the numbers, right?
Which is, it's a bunch of dod sets.
I mean, he's basically turned on a dime.
And nobody really holds him to it.
Although I do believe that come the 2020 election, the Democrats and the media are going to take Trump to task.
I think they're giving him kind of a free ride now, lulling him into a false sense of security.
But I think it's going to be very easy to bash him over the head because Trump could be his own best critic.
Because a lot of the things that Trump was criticizing the economy about, I mean, you know, not only did he not solve those problems, he's now, you know, basically doing exactly what he was criticizing.
Yeah, no, absolutely.
I mean, I think candidate Trump was absolutely right when he said, you know, the unemployment numbers are kind of phony because they don't account for all the people who have dropped out of the labor force.
And he was absolutely right when he said that basically this recovery is not what it's cracked up to be.
And it's like, you know, I know I've heard you talk about this before.
The CPI numbers are kind of phony.
They don't really take into account.
They're not kind of phony.
They are phony.
And it's not a conspiracy.
They just came up with a formula that basically takes price hikes and diminishes them so that the final number shows a much lower increase than the actual increase in costs.
So the real cost of living is rising a lot faster than the official measures.
But then the Fed says, oh, we don't have enough inflation.
We need more.
We actually have more than we don't need any of it, actually, but we have a lot more than the numbers reveal.
But because the numbers are wrong, we keep on creating more.
It's like if you're driving your car and your speedometer is broken and you're driving at 30 miles an hour, but your speedometer says 10.
He says, oh, we got to go faster.
You step on the gas and then you're going 50, but it still says 10.
And you go, I better go faster because I'm not, you know, then you're going to get into an accident because you're speeding because you're looking at this speedometer and you're not paying attention to the real world.
If you looked around, you would see that you're not going 10 miles an hour.
But if you're just going to look at the stupid broken speedometer, then you're not going to know.
And so if you just look at the government's speedometer of inflation, the CPI, you don't really know what's going on, even though that number is going up.
But if you actually shop, if you actually buy stuff.
And, you know, by the way, the other things that Trump was saying as a candidate, I mean, he said that we were losing on trade, right?
We had these huge trade deficits and elect me and I'm going to make the trade deficits go away.
The trade deficits are bigger than ever.
Obama never ran trade deficits as big as the one Donald Trump is running.
In fact, he said that the worst trade deal that was ever negotiated in the history of trade deals was NAFTA.
Worst deal ever.
He negotiates NAFTA 2, which is almost identical to NAFTA.
He just calls it the USMCA and says this is the greatest trade deal ever when there's basically hardly any difference.
The only difference is NAFTA had a better name than the one we got now.
But it's basically the same deal, repackaged, but it's gone from the worst one in history to the greatest.
In fact, you remember when Donald Trump was a candidate, he actually talked about paying off the national debt.
He's like, I'm going to pay it all off, right?
We're going to be out of debt, right?
We got more debt than ever.
We're bleeding red ink.
So all of these statements are going to be used against Trump in the next election.
And Elizabeth Warren, too, she's out there warning about an economic crash, warning about a phony economy and too much debt and problems in the banking system.
And she's right now for the wrong reasons, but she's going to look a lot smarter than Trump when she's going to be able to say, yeah, I warned about these problems.
I told you so.
Trump was in denial.
Trump thought everything was great.
He doesn't know anything.
And so vote for me.
And of course, she's going to take all the problems and make them much, much worse.
Yeah, it seems like Elizabeth Warren and Bernie Sanders, and I agree with you.
I think Elizabeth Warren is more likely to come out as the nominee.
But both of them seem to tap into this kind of left-wing populist energy.
The College Debt Racket00:10:45
And they do address some very real problems.
It's just they have the exact wrong solution for every one of them.
And they have the exact wrong cause.
Well, yes, that's right.
And the irony of it is it's government that has caused all the problems that they're so upset about.
Yet they're blaming it on capitalism.
Right.
And they want more government as a solution.
One of the best examples, and I just talked about it on my podcast last week, is the student loan problem, which would not be a problem but for the government.
The government is the only reason we have student loans.
And without student loans, college would be a lot cheaper, just the way it was before student loans.
So you have a problem that only exists because Democrats, liberal politicians, wanted to buy the votes of 18-year-olds who had just got the vote, and they wanted to give them something for nothing.
So they promised to make college more affordable by guaranteeing loans.
And then basically they took something that was very affordable.
Anybody who wanted to go to college before the government got involved in loans, anybody could go.
Either your parents paid for it or you got a job and you worked your way through college, but nobody graduated with any debt, right?
And now we have this massive problem, right?
People are broke.
They're drowning in $100,000 or more of debt.
And you have all these Democrats talking about how big this problem is and how they have to solve it.
They caused it.
And their solution is to get the government even more involved, to provide free education, which is going to cost a fortune.
Nothing is as expensive as what the government provides for free.
So if you think education is expensive now, way do you see how expensive it is when it's free?
But what we should do is go back to a free market in education, get the government completely out of it, right?
No more aid, no more loans, guaranteed direct, get rid of it all.
And then if we do that, we can actually have some debt relief for the people who were unfortunately led down this primlerose path by the government and the educational establishment that profits so much off of this.
See, that's who makes money off of student loans is the colleges, right?
The colleges benefit.
But under a free market, they would not do that.
Under a free market, colleges would have to provide quality education at an affordable cost.
Otherwise, they'd have no customers.
But the government makes sure they have customers, no matter how lousy the product is or how overpriced it is.
Yeah, I actually do have some degree of sympathy for some of these kids who come out with so much debt because it's this giant racket where the government gets to buy votes, the financial companies get to make loans that are guaranteed by the government, and the colleges get to keep these huge profits.
And the kids get stuck with a worthless degree and a bunch of debt.
And about 80% of them probably never should have been in college to begin with.
They're literally just going there to stop off to get jobs.
This is a terrible thing that we've done to our young people.
And look at, you know, you read these articles today about all these women that basically have resorted to prostitution in order to get through school.
So the government has turned our daughters and our sisters into prostitutes.
Instagram prostitutes.
Well, whatever.
But prostitute.
I mean, it's just, it's more efficient prostitution.
No, a lot of them are, you know, they're on seeking arrangement or whatever these sites are sugar babies.
And they find guys, you know, who have money and that's how they, you know, how they get through school.
It's really disgusting.
Unfortunately, the young men don't have that.
They can't even do that.
Right.
There's not many women that are going to pay for sex.
Yeah.
You know, it's funny because, and I think that a lot of what fuels the populist movements, it's kind of what you like the analogy you used before where you're going 50 miles an hour, but the, you know, it says 10 miles an hour.
But there's still a lot of people in the back of that truck who are like, feels like we're going faster.
You know, I know that they're telling us we're not.
I mean, I was just talking to my mother-in-law and father-in-law the other day, and they were both just commenting.
They're like, man, everything's so expensive these days.
Like, you know, like even, and they're not economists, you know what I mean?
But they're just going like, man, things really are like the prices are getting out of control.
It's like people notice this.
And one of the things that I've heard a lot of people talking about, and Elizabeth Warren has talked about this, and Tucker Carlson has talked about this, is that they're like, man, people just can't afford to have families anymore.
Like even two incomes isn't enough.
Look, look, my grandfather was a carpenter.
He came to this country when he was 13.
He had no money and didn't even speak English.
Yet he was able to support eight children and my grandmother.
My grandmother didn't have a job.
And that was the way it was back then.
I mean, nobody's wife worked.
I mean, even if you didn't have a high school degree, you could support a family.
And it should be even easier for uneducated people to support families today with all the technology that we didn't have 100 years ago that we have today.
No, it's all because of government interference in the free market.
We would have a much more vibrant economy, but for the government interference in capitalism.
And of course, whenever the government interferes with capitalism, it screws up and then capitalism gets to blame.
And the government takes advantage of that by saying, you see, capitalism doesn't work.
We need more government.
And then, you know, government keeps getting bigger and bigger and doing more and more damage to the economy.
Yeah.
And this is the problem when you don't understand the cause of the problem.
And it seems like, you know, like I was talking about this on one of my last shows where, you know, Joe Biden was defending Obamacare because he was like, well, people, you know, people really like that their 26-year-old can stay on their insurance.
And, you know, I was making the point.
It's like, okay, fine.
I understand people like that.
But does no one ask the underlying question there, which is obviously, why does a 26-year-old need to be dependent on their parents?
I mean, when my grandfather was 26, he was like, you know, seven years removed from a war.
I mean, he was like supporting himself by that.
Why do you need to be dependent on that?
Well, we're keeping kids in school now until they're 24, 25, 26, 30 sometimes, because a college degree gets you nowhere.
So a lot of people stay in school to get a master's and a PhD.
But since there's so many kids in college that shouldn't be there, the classes are so full that to get a four-year degree takes a lot of people six years.
Look, you know, if you remember, I went down to Zuccotti Park.
Oh, yeah, of course.
Occupy Wall Street.
If you guys haven't seen, you have to go to YouTube and watch that video.
It's one of the greatest things ever.
It's Peter Schiff, 1%, Occupy Wall Street.
You'll find it.
I'm sorry.
Go ahead.
But the reason I went down there, again, you made the point yourself is that the problems are there, but everybody is pointing their finger in the wrong direction.
They're pointing it at capitalism and not government, not the Federal Reserve.
That's where they should be looking.
Now, because Wall Street benefits from these bad policies, Wall Street gets the blame because they're seen as the face of the problem.
And in a way, they're complicit in this by not speaking up, right?
They're taking all this free money and, you know, they're, you know, conspicuously, you know, flaunting it.
But, you know, in the end, they're ultimately the, you know, setting the stage for their own destruction because they are creating a monster here.
Because when we get socialists running this country, you know, first you get in bed with the government and then the government does what happens when you get in bed with somebody.
And that's what's going to happen to all these private businesses that have been cozying up to the government to get all that free money.
They're going to lose a lot more than that when all of a sudden the government totally destroys their businesses.
Because what the real motivation is of the left, what guys like Bernie Sanders really want to do is they are dyed in the wool socialists.
They don't believe in private property.
They want the government to nationalize the means of production from each according to his ability to each according to his need.
These guys believe this nonsense.
I mean, most people are smart enough.
They only believe in socialism when they're kids.
But by the time they grow up, you know, they're smart enough to know it doesn't work.
Well, Bernie Sanders never grew up.
I mean, how old is the guy?
He still believes.
It's like a little kid believing in Santa Claus.
In fact, Santa Claus makes more sense than socialism.
Yeah.
Well, I mean, Bernie Sanders went to the Soviet Union for his honeymoon in the late 80s.
This is the late 80s.
I mean, if you didn't realize the Soviet Union wasn't working out by that point, I mean, they were like a few years off from collapse.
And he was still like, this is a good system they got going here.
Yeah.
You know, and they just want to, you know, they just want to repeat it here because all these socialists, they always think the problem is, you know, the people didn't do it right.
You know, they didn't have real socialism, you know.
But, you know, look, the more socialism you have, the poorer you are.
The more freedom you have, the richer you are.
You know, every place in the world now, I mean, nobody is a pure capitalist country.
You have elements of socialism and you have elements of freedom, which is capitalism.
But to the degree that you can minimize socialism and maximize freedom, you have more prosperity.
But what Elizabeth Warren and Bernie Sanders wants to do is dramatically limit freedom.
They're promising free stuff, but free stuff is not freedom, right?
First of all, for one person to get something for free, somebody else has to pay for it against their will.
The government doesn't have anything.
It only can redistribute what it takes.
So the more freebies the government promises, the more of its citizens are being enslaved to meet those commitments.
So, you know, what freedom means is freedom from government.
That's what people came to America for.
Freedom means the government leaves you alone, right?
And then you're free to pursue your own happiness and your own self-interest.
It's not about trying to steal things from other people.
You know, government is supposed to secure your rights, protect the things that you own from people that want to steal it.
But today, what we need protection from is our own government because it's our own government that's doing the theft.
Only they want to call it taxation and regulation, but it's really legalized theft.
Yeah, and it is really, I mean, it is unbelievable how much they steal.
I mean, I just started making decent money and man, there's a, whoof, what I have to pay for this government that I hate so much is really outrageous.
Well, I finally was able to, you know, in my 50s check out by moving to Puerto Rico.
You know, I still pay some taxes and I still have to spend a lot of money filling out my tax returns, but at least the numbers on the checks are a lot smaller now because I'm living in Puerto Rico.
So I encourage anybody that wants to be free to come on down here.
Legalized Government Theft00:09:39
If I keep making money, I'm going to be joining you in Puerto Rico one of these days soon.
I was disgusted by these last couple years, how much I've had to pay in taxes.
And I'm sure there's people who've paid it.
I've got nothing yet.
Yeah, no, I know.
Elizabeth Warren's coming after you for your own good.
So what do you think?
You know, I've certainly been very surprised.
I think you have too.
Correct me if I'm wrong.
And a lot of people have, that the bubble that we're in right now has been able to last this long.
I mean, I really, I did not think we would get through eight years of this.
Is this because all of the central banks in all of the industrialized world are kind of working in coordination with these low interest rates?
How have they been able to keep it going this long, do you think?
Yeah, that is certainly part of it.
And, you know, I'm in the same boat as you.
When I was writing my first book, Crash Proof, how to profit from the coming economic collapse, when I was writing about how I thought the bursting of the housing bubble would lead to a great recession, which would ultimately lead to an economic crash.
Yeah, I didn't think that we'd be sitting around in 2019 and the collapse that I was writing about wouldn't have occurred yet, even though all the other events that I predicted that would precipitate the crash have occurred.
And, you know, what did happen is, yes, all the central banks around the world, particularly in Europe, the ECB and Japan, basically did the same thing that we did.
They slashed interest rates.
And so on a relative basis, they made the dollar appear more attractive and people began to be more concerned about what was happening in Europe or what was happening in Japan.
And we were the beneficiaries of all that flight capital because it kept the whole thing going.
I mean, we kept borrowing more money, going deeper into debt so that we can keep on consuming and keep this phony economy going.
And that's what happened.
But, you know, because we succeeded in kicking the can down the road for all these years, all of the problems just got bigger.
So now, you know, we're dealing with a bigger bubble.
And so when it pops, it's going to be far more disruptive, far more painful.
Had we been digging our way out of the hole for the last decade, you know, we'd probably be out of it by now.
Instead, we've been digging the hole bigger.
We're in the Grand Canyon of economic holes now.
I mean, who knows how long it's going to take to get out of this?
Yeah.
Do you think, I mean, I know in the past, what's triggered these economic crashes has been raising interest rates.
But we just saw the Fed, as you pointed out earlier, I mean, they raised rates under Trump, but it was two rates that would have been historic lows if they were at any other time in my lifetime.
And then they are immediately pulling rates back even without a recession coming.
Do you have an idea of what you think is going to be the triggering event or what's going to bring on this next inevitable crash?
I don't think it's going to be the Fed raising rates.
It's going to be the markets raising rates despite the Fed's efforts to suppress them.
And we've already seen that.
That's why the Fed had to go back to QE4.
Only they're just calling it repurchase agreements or permanent open market operations, whatever it is.
But they're trying to artificially suppress rates because they realize that when rates go up this time, the economy is down for the count.
And so they're just doing everything they can to postpone the day of reckoning as long as they can, even though the more they succeed, the more we all fail because they can't stop the day of reckoning.
All they can do is make it worse by delaying it.
But for a politician, delay is the only thing you can do because you're just trying to get to an election and you don't care.
That's why it would have been nice if Trump actually was a statesman who cared about the country instead of just a politician worried about his own reelection.
But unfortunately, that's what he is.
I think the Federal Reserve chairman, they just want to keep it going until they can either get reappointed or go land a book deal or get some job at some private bank.
So they just don't want it to blow up while they're at the helm.
But I don't think the Fed is going to raise rates the way Volcker did.
We don't have the guts to do that or the ability to do that, but the market's going to raise rates.
But I think when this thing really starts to fall apart, we're seeing it now in gold, but gold isn't taking off.
I mean, gold hit a six-year high.
We're above $1,500.
Let's see gold go through 2,000 and really start to move higher.
We need to see the dollar breakdown.
That hasn't happened yet.
It's still, you know, it's weak against gold, which shows that it's weak.
But, you know, the foreign exchange markets are not showing that because the dollar is not as weak as some other currencies right now.
But when the dollar becomes the weakest currency, which it will, that's another sign that it's about to hit the fan.
And if you start to see the long end of the bond market falling with the dollar as the price of gold is rising, that's it.
It's over.
All right.
Well, it's not pleasant to think about, but this stuff is seeming more and more inevitable.
I mean, you look at where the Fed, the Fed asset, the balance sheet at the Federal Reserve, what was it?
It was something like $800-something billion dollars in 2008 when the markets tanked.
And what is it?
It's $4.5 trillion or something like that?
No, that's where it got to.
That's where it got to.
Oh, they started selling down.
And they brought it down to below $3.8 trillion.
It's now back above $3.8 trillion because in the most recent week, they expanded the balance sheet by $75 billion.
We'll find out tomorrow how much they expanded it by in the following week.
I'm sure it grew again.
So the balance sheet is going to go up.
I think by the time the 2020 election comes around, the balance sheet will be bigger than the $4.5 trillion it hit before they started to shrink it.
But, you know, ultimately, it's going much, much higher than that.
I mean, that's, you know, especially if Sanders becomes president, because there is no way that this laundry list of government programs is going to be funded by taxing the rich.
Because I have no doubt that they'll try to tax the rich.
It's just that when you do, when you, when you tax, you, you know, you end up altering behavior and you impact the economy.
They want to tax wealth.
Well, there's going to be a lot less wealth to tax once they have a wealth tax.
They're going to raise the income tax, but there's going to be a lot less income to tax, not only for the rich, but for the people that the rich no longer employ because they're no longer trying to make money that the government's going to confiscate.
So the whole economy is going to end up being smaller.
And so the government is going to be redistributing a smaller pie.
And so they may raise taxes a lot, but they're not going to raise revenue a lot.
In fact, they may get less revenue, but they're going to increase spending dramatically.
Where is all that money going to come from?
The Fed is going to create it out of thin air and it's going to buy up all the government bonds that the Treasury has to sell so that we can finance all these freebies.
And so we talked earlier about a rising cost of living.
It's going to be spiraling out of control.
I mean, it's going to be like the 1970s, only on steroids.
So what can people do to protect themselves?
Precious metals?
You see above my shoulder, right, there's a logo for shift gold.
So people could buy some gold, buy some silver.
My company, Shift Gold, has got great prices.
I don't think anyone's going to beat us.
You know, we'll make sure you get the most gold and silver you can for your money and pay as little premium as possible over the spot market.
But people definitely should be doing that.
They should be getting out of U.S. financial assets entirely.
I mean, if you're retired or close to retirement and you want to stay retired instead of watching your money retire and having to go back to work, doing who knows what, you need to move your account to let me manage it for you.
Europe Pacific Capital is a company.
We do asset management.
I have mutual funds that we run, separately managed accounts.
We got to get out of Dodge.
You got to get invested not only in precious metals and mining stocks, but there's a lot of good conservative companies all around the world in countries that are not nearly as screwed up as the United States, where you'll get good dividends in currencies that will retain a lot of their purchasing power, unlike the dollar that's going to lose most of its purchasing power.
I mean, the good thing about my investment strategies in foreign stocks is I don't have to be right for you to make money.
Even if I'm wrong, the U.S. stock market is at a record high valuation relative to overseas markets and particularly emerging markets.
So even if none of the bad things happen, I think investors are going to do a lot better investing abroad than they will investing in the U.S.
But if I am right and we get this collapse, then it's going to be an even bigger difference.
I mean, it's going to be a difference between retirement and working every day until you drop debt.
If you want to preserve your standard of living, and in fact, I think there's an opportunity to actually grow your standard of living.
There's going to be a lot of people who are going to be impoverished who don't see this coming, but there will be some people who see the writing on the wall and have the courage to act on what they read in advance.
They're actually going to profit.
My only concern is that the government takes the profits away, right?
I mean, that's going to be a problem.
And I can make people a lot of money and then the government says, all right, you're in the 90% tax bracket.
What are you going to do there?
But at least I can help people avoid the losses to inflation and to the market by having people entrust their retirement accounts, their IRAs, whatever money they have under my management.
And I'll get it invested around the world in the safest havens I can find in the assets that I think will deliver the best real return relative to inflation and a weak dollar.
Tom Woods Wrap Up00:02:42
Well, I appreciate that.
And I appreciate you coming on the show.
It's always interesting to hear your perspective.
It was interesting to talk to you because I've been reading your stuff and watching you for so long.
And I still remember like it was yesterday back in 2008 when everyone on CNBC and all the financial writers were saying, you know, there was no way we could have seen this coming.
This was just, it was like an act of God that, you know, nobody could have possibly predicted.
And then you'd see, you know, a Peter Schiff video of this guy like, oh, no, but you're, this guy told you this was going to happen two years ago and you laughed at him.
So people, I mean, if you haven't watched those videos, go watch YouTube.
Peter Schiff was right.
There's a bunch of them that went viral that'll come up.
So, you know, listen to this man when he talks about the economy.
And make, you know, I'm talking, I do these podcasts several times a week.
People should, you know, subscribe at Shift Radio to my podcast or go to my YouTube channel, Shift Report, and just, you know, sign up there and just listen to my podcast on YouTube or, you know, in your car, iTunes, Stitcher, wherever.
But I try to put out as much content as I can.
and tell your friends about it because there's a lot of fake news out there.
And so, you know, you're getting the truth from me.
Yeah.
And of course, the Peter Schiff radio show was what was part of launching the Tom Woods show.
I know a lot of people listening to my show are fans of Tom Woods as well.
By the way, quick plug, I'm taking over the Tom Woods show for a week.
It's Dave Smith Week.
I think that's coming out next week or the week after.
We've already recorded three of the episodes.
Tom used to guest host my show.
I remember well.
And I had people like Stefan Mullenu did it and Larry Elder because a lot of times I would travel.
And then the producer of my show ended up producing Tom's show.
And he continued his, he does his show now every day, I think, right?
And I stopped doing mine because I didn't have the time.
Yeah, you got to get out there in Puerto Rico and enjoy that tax savings.
Yes, yes.
All right.
Well, Peter Schiff, thank you so much for coming on.
I very much appreciate it.
Hope we get to talk again soon as The Economy moves along.
Keep up the good work.
All right.
Thank you.
You too.
All right, guys.
That's going to be it for our show for today.
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Peace.
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