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September 13, 2013

The Crisis Is The Debt, Not The Debt Ceiling

"I don’t see the debt ceiling as the crisis, that’s part of the solution. The crisis is the debt, and the crisis is that we’re going to raise the debt ceiling. We’re going to keep raising the ceiling so we’re going to keep piling more debt on top of the debt that we have.

And, eventually, the crisis comes not because we don’t raise the debt ceiling, but because lenders don’t raise the lending ceiling because they recognize that we’re broke. They won’t want to throw good money after bad, they don’t want to keep lending money to a country that can’t pay back what has already been loaned to it.

That’s when we have a real crisis—interest rates go up; the dollar collapses. The debt ceiling is just politics. We’d be better off if the debt ceiling couldn’t be raised, because then we’d actually have to deal with the problem instead of kicking the can down the road." - in Index Universe 

Related ETFs: Financial Select Sector SPDR (XLF), SPDR Dow Jones Industrial Average ETF (DIA), SPDR S&P 500 Index ETF (SPY)

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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