December 6, 2022

Philip Schiff: Consumers Are Concerned; Investors Are Clueless

‘If Powell actually tried to fight inflation, he would destroy the bubble economy. The stock market might crash. We’d be in an enormous recession. “

Will be bitcoin an inflation hedge?

Philip Schiff recently appeared upon RT Boom Bust along with Natalie Brunell of Coin Stories to discuss inflation and whether bitcoin is a hedge. Peter said bitcoin is not really an inflation hedge. This individual called it a “ speculative token” with its cost driven by supply plus demand.

But what about  gold ? It didn’t execute like an inflation hedge within 2021 despite the  inflation freight train . Peter said the reason gold has had some problems is because the market wrongly believes the particular Fed.

“ They believe Powell when he says he’s going to perform whatever it takes to bring inflation back down to 2%. He’s going to raise interest rates. He’s going to start diminishing the balance sheet. And the markets are believing Powell. But I think he’s just bluffing. And even if he follows through with the rate hikes he’s promised, that’s too little too late. It’s not going to be almost enough to slow down inflation. And so, it’s not going to restrain gold. ”

The type of rate hikes and balance page reduction necessary to get ahead of the inflation curve would be too much for the bubble economy to deal with.

“ If Powell actually tried to fight inflation, he would ruin the bubble economy. The particular stock market would crash. We’d be in a massive recession. Plenty of unemployment. A huge financial crisis. And we would force the government directly into insolvency. Once the markets fully understand reality, they’re going to be buying gold. ”

Natalie agreed that the Given can’t fight inflation and will also be forced to pivot back to delivering liquidity to the market. She said that will send both stocks and shares and bitcoin higher.

So where will consumers look to hedge? Will these people turn to gold? Bitcoin? Or possibly other cryptocurrencies that are available?

Peter stated right now most investors tend to be not even really worried about inflation.

“ They believe the Given. So , they think that the particular inflation problem is going to become solved. ”

But at some point, people will realize that it’s actually going to get worse. The Fed is usually ultimately forced to do an about-face because Powell actually thinks he can raise prices without hurting the economy.

“ He thinks we have this particular strong economy. We may. We have a gigantic bubble. And even the smallest of pins is going to prick it. In fact , just talking about raising prices, and this has already pricked the bubble. We’re already just about in a bear market at this point. And so, I think that at some time this year, whether it occurs before the first rate hike or even after, Powell’s going to cave and he’s going to go back to bigger QE and rates return to zero. And that’s when the marketplaces are finally going to understand the predicament that we’re within. ”

Peter said the markets need to realize it already. “ But for some reason, they require a safe to drop on their head. ”

“ And when that occurs, then they’re going to be looking designed for inflation hedges. They’re not going to worry about bitcoin. That’s for gamblers. They’re going to look for a real store of value and they’re likely to be buying gold. They may be buying silver as well. And I think they will be buying all sorts of real possessions to get dollars. ”

Peter highlighted that consumers are concerned about inflation.   Consumer emotion data bears this away . But Peter stated investors are clueless.

“ People are very concerned. And they must be. And unfortunately, it’s going to get much worse for consumers. ”

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