Federal Reserve is doctoring statistics; financial expert predicts US economic bubble to collapse soon

Best-selling author and financial expert Peter Schiff is someone worth listening to when he makes a forecast regarding the economy.

Schiff, who is also CEO and chief global strategist at Euro Pacific Capital Inc., was one of the few who accurately predicted the crash of 2008. But, as he is fond of pointing out, that crisis was merely an initial tremor compared to the financial earthquake that he predicts will be coming in the near future — perhaps as early as 2015.

In recent interviews, Schiff has been warning that estimates of economic growth are overblown, and that the U.S. economy is in far worse shape than the GDP growth figures suggest.

In fact, he predicts that, unless we take our lumps now in a controlled manner (in other words, admitting that the U.S. is essentially bankrupt and allowing a correction to take place without more artificial propping up of the economy by the Federal Reserve), we will face a far more serious crash in the very near future resulting in the complete collapse of the dollar — a financial Armageddon that Schiff refers to as the “Day of Reckoning.”

Despite the rosy estimates of 5 percent GDP growth in the last quarter of 2014 (does anyone really believe that, anyway?), Schiff believes that, without another round of quantitative easing and the Fed keeping interest rates near zero, the U.S. economy would probably slip into recession in 2015.

And even though that would result in a “bloodbath,” with people defaulting on debts which they can’t even pay the interest on, and with banks failing, Schiff says that’s exactly what needs to happen.

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In an interview with Wall Street Daily, he said:

Allowing that natural, free-market restructuring, that process is healthier and more conducive to a return to legitimate growth than what the Fed is doing. Than trying to prevent that through inflation, through printing money and quantitative easing and zero-percent interest rates. But the Fed is going to continue to fight this battle until it loses the war, and that means the dollar collapses. And I think that’s ultimately where we’re headed.

And Schiff is not the only one who sees it that way — many economists and financial forecasters have been saying the same things for years now. It doesn’t take a degree in economic theory to understand that printing increasingly worthless dollars and artificially propping up the American economy will lead to disaster.

So why are the powers-that-be so reluctant to face the obvious facts?

The answer, according to Schiff, is that politicians are more concerned with becoming reelected than with doing anything that might actually help boost the economy in a healthy manner over the long term. They simply prefer to delay the inevitable until the next guy comes into power.

As Schiff puts it:

You have to admit what the source is, and politicians don’t wanna do that, I mean, because they basically have to admit that they’ve been lying to the public for years, that all the things that the government has done to help the economy have actually made it worse….

So, their own self-interest is to pretend that the problems don’t exist or to try to get the Fed to cover ’em up.

Strong words, but ones that the public needs to hear. If we don’t begin to face the reality and gravity of the situation very soon, we can expect the “Day of Reckoning” to be far more devastating than is necessary. Putting it off will only make things harder on all of us in the long run.

It’s time to pay the fiddler — or else…

Sources:

http://www.theblaze.com

http://www.wallstreetdaily.com