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November 8, 2012

The Fed Cannot Keep Printing Indefinitely Without Consumer Prices Going Wild

The Fed cannot keep printing indefinitely without consumer prices going wild. In many ways, this has already begun. Take a look at the gas pump or the cost of a hamburger. If the Fed ever hopes to control these prices, the day will inevitably come when the Fed needs to sell its portfolio of long-term bonds. While short-term paper can be easily sold or even allowed to mature even in tough economic conditions, long-term bonds will have to be sold at a steep discount, which will have devastating effects across the yield curve. - in Finance Townhall

Related: iShares Barclays 20+ Year Treasury Bond ETF (TLT), iShares Lehman 7-10 Yr Treasury Bond ETF (IEF)

Peter Schiff`s comments on the economy, stock markets, politics and gold. Schiff is the renowned writer of the bestseller Crash Proof: How to Profit from the Coming Economic Collapse.
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