Peter Schiff Warns Investors of 2 ‘Huge Surprises’ — Foresees Inflation Too High for Fed Rate Cuts to Stimulate Economy
Economist Peter Schiff says investors are in for “two huge surprises.” Noting that the Federal Reserve has already lost its fight against inflation, he explained that by the time the U.S. economy officially enters a recession, inflation will be too high for the Fed to “stimulate” with interest rate cuts.
Peter Schiff Sounds Alarm on U.S. Economy
Economist and gold bug Peter Schiff issued multiple warnings about the U.S. economy in a series of tweets this week. He wrote on Wednesday:
Investors are in for two huge surprises. The first is that future inflation rates will be much higher than they think. The second is that the Fed won’t be willing or able to do what it takes to fight it.
Following the U.S. Bureau of Labor Statistics report, released Thursday, that the consumer price index (CPI) rose 3.2% from a year ago in July, Schiff tweeted: “Don’t believe the financial media’s spin that July’s 3.2% YoY CPI rise, with YoY core at 4.7%, means the Fed is winning its war against inflation. Core is bottoming, and the headline number is about to rise sharply, led higher by surging oil prices. The Fed has already lost.”
The Bureau of Labor Statistics also reported Friday that the producer price index (PPI), which gauges the costs that goods and services producers receive for their products as opposed to those that consumers pay, rose 0.3% for the month.
“Today’s hotter than expected .3% rise in July PPI is only the beginning. Future, even larger upside surprises are coming,” Schiff tweeted in response to the PPI report. He opined:
The worst part is that by the time the U.S. economy officially enters a recession, inflation will be too high for to the Fed to ‘stimulate’ with rate cuts.
Schiff has regularly warned about the U.S. economy and the U.S. dollar. Earlier this month, he said the USD’s collapse is “inevitable,” advising people to get out of the dollar now. He has also repeatedly cautioned that the Fed has already lost its inflation fight but the markets have not figured that out yet.
What do you think about the warnings by economist Peter Schiff? Let us know in the comments section below.
Source: Bitcoin.com
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