"GE is kind of a microcosm for the country. It used to derive most of its income from manufacturing. It later expanded its financing unit into areas like credit card lending."
Schiff, who published Crash Proof: How to Profit from the Coming Economic Collapse in 2007, has argued for years that without a solid manufacturing base, America's position as the greatest economic power of the 20th century would not last through the 21st century. "If we're going to continue to consume, we need to start producing. We can't simply keep running deficits month after month," he wrote. " We can either ratchet down our lifestyle to reflect the fact that we're not an industrial nation, or we can make more stuff. Those are the choices."
When asked whether or not the potential still existed to turn around the economy, Schiff expressed hope that government policy would stop obstructing necessary change. "It is possible... it might not be possible given what the government is doing today, but it is possible." He also added that as long as the Fed and the Treasury refuse to allow failure, there will be no chance to let the economy restructure itself and create real wealth.
Given our current tax code, the simplest way to bring down medical costs would be to fully tax health care benefits as wages and simultaneously increase the personal deduction by an amount significant enough to neutralize the effect of the tax increase. This would do two things. First, the uninsured would get a huge pay increase, enabling them to buy reasonably priced catastrophic policies. Second, those currently insured could opt out of expensive employer-provided plans, trading premiums for extra wages, then buy a more economical plan. The savings would go right into their pockets.
The bottom line is that aggregate medical costs will never come down unless services are rationed more wisely. Rather than being used as a pre-payment plan for routine care, insurance should only cover unpredictable, catastrophic costs.
"The last thing we need is more borrowing. We need less borrowing. The government is trying to encourage more consumption when we are in trouble because of all the excess consumption." in Opposing Views, June 2009
The current headline unemployment rate of 9.5 percent does not truly capture the situation on the ground because it ignores those who are 'marginally attached' to the workforce. 16 percent is more realistic representation of the situation, and I estimate about a 20 percent unemployment rate by the end of this year.
The Obama Administration will be like Jimmy Carter's. They're going to tell everyone to 'sacrifice' to support a government that is just too large and too powerful.
We may have reduced interest rates now, but with higher inflation, we will have to raise them in the future. Then, we will have recession, rising prices, and no available credit. This will smother any potential for recovery.
The things the government is doing with the economy only put us into deeper debt and deeper trouble. All they will probably do is buy us time, interfere with the current situation and postpone the unpleasant consequences in exchange for more damage in the future.
Topics: downtrend in the US dollar; uptrend in oil; rising 10 year yields that doubled from their 2% lows; commodities are moving higher not because of economic strength but because of inflation; inflation is a monetary phenomenon and not a function of capacity; you can get inflation and unemployment;
Topics on the Peter Schiff`s market update: Obama goes to the Middle East and tells the Saudi`s that the deficits are under control; The US will not payback the debt; Ben bernanke talking on Capitol Hill; I don`t want to hold any US Treasury Bonds; Bernanke on Inflation; Bernanke is monetizing the debt;
Peter David Schiff (born March 23, 1963) is an American economist, author, commentator and popular video blogger. Schiff, a licensed stock broker, is the president of Euro Pacific Capital, headquartered in Westport, Connecticut