Soaking the rich will drown everyone else – Ep 611

* It really was a brutal week on Wall Street, led by the tech-heavy NASDAQ, which is down about 5-1/2% on the week; 3% of that alone came today, now down about 17% from its high * Not officially in a bear market yet, but getting there * The vast majority of NASDAQ stocks are in bear markets, in fact, many of those stocks are down 40 or 50% or more - a number of those stocks down 40 or 50% today alone * The Russell 2000 is already in a bear market; it's down 24% * Dow Transports also down 25%, and transports were actually up this week * The S&P and the Dow are only down about 12% - in correction but not quite a bear market, but remember, all bear markets begin as corrections, and I think this is just the early stage of a bear market * You can contrast that with what's going on with gold; gold was up 5% on the week.  It added $18 today alone to close above 1170, in fact the price of gold has risen by $120/ounce since the Federal Reserve raised interest rates in December * The dollar also had a bad week, despite rising somewhat today on the jobs numbers, the dollar index had its worst weekly decline since 2009 * So now, the opposite of what everybody expected has happened * Everybody thought the stock market would go up, because the rate hike was proof that the economy was stronger; instead the stock market has tanked, in fact the beginning of January was Wall Street's  worst start to the year in history * In contrast, the expectation was that rising interest rates would help the dollar; instead the dollar has actually declined * Higher interest rates were expected to be bearish for gold; instead it was the catalyst for a huge rally in the price of gold * The weaker than expected jobs report was assumed to be the reason for today's stock market carnage, because we only created 151,000 non-farm payroll jobs and the Street was looking for 188,000 jobs * The reality is not that the report was weak, it is that it was not weak enough * The only thing that could have saved this market would have been a horrible jobs report - a jobs report so bad that an interest rate hike would be clearly off the table * Instead, this jobs report could indicate that the Fed is more likely to raise rates as a result of the numbers * That is why the market went down * No one wants to admit that the only thing holding up this market is the Fed, so they pretend that the market is disappointed by the weakness of the report * Jobs have nothing to do with it - this market has always been about one thing - the Fed and cheap money * Now it hangs on weather the Fed will raise rates again * I believe the next thing the Fed is going to do is to cut interest rates * I think they might even go negative and they going to launch QE4 * The markets have not figured this out yet * Even the Atlanta Fed, whose first estimate of Q1 GDP at just 1.2% (I think this is an over-estimation; I think the Q4 .7% will be downwardly revised) saw this apparently strong jobs report they increased their Q1 GDP estimate by a full percentage point to 2.2% * If the Atlanta Fed thought the jobs report was so strong, why are the reporters assigning blame to the jobs report for the sell-off * If you look beneath the headline number of the miss, on the number of non-farm payrolls, you'll find out what the markets were so worried about: * 1) The official unemployment rate moved down to 4.9% - that's the first time we've had a 4 handle on the unemployment rate since Obama has been President * In fact, he did not waste much time calling a press conference proclaiming the success of his administration and declaring that the U.S. economy is the strongest in the world; quite ironic because I thin we are already in recession Our Sponsors: * Check out Aeropress and use my code GOLD for a great deal: https://aeropress.com * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

6 Feb 201627min

* So far the month of February is just 4 trading days old, and already the U.S. dollar index is down just over 3 percent * We closed January at 99.6 and we closed at 96.5 * Gold, going the other way, now up about $13 today, closing above $1,155; the price of gold is up almost 3.5% in the first 4 days of February * That shows you that most of the move in gold is the result of the dollar going down * This move is just getting started * The markets are just beginning to price in the fact that the Fed is not going to raise rates in March * They are pricing 3, rather than 4 rate hikes this year, and that's the only thing that is not driving the markets * A more realistic look what the Fed is likely to do is to not raise rates, but cut them below zero * Despite that we're seing all this momentum in the dollar and in gold * Gold stocks are just soaring, many of these names have been up 5-10% each day in February * None of this is attracting the attention of Wall Street * A guest on CNBC today alluded to short covering as the reason for gold going up * He commented on how lousy the fundamentals are for these stocks * The fundamentals have never been lousy * They have appeared lousy because there was so much belief that the dollar would continue to rise because the U.S. is having a genuine recovery and the Fed will continue to raise rates * The media and Wall Street are still very biased; I was on CNBC Asia last night debating an American guest who touted the strength of the economy based on the strong jobs market, how household balance sheets are better than ever and real incomes are rising * The only reason homeowners have better balance sheets is because they no longer have a house; home ownership is at a 50 year low * While gas prices are lower, rents, healthcare and most other costs are going up * It was an example of how the public ignores all the bad economic news and assumes that the economy is great * Another writer for CNBC.com attributes gold's rise to low inflation * He actually said that my explanation about the economy slowing with inflation did not make sense, because in his mind, high inflation is a result of a strong economy * This is exactly backwards. Strong, productive economies keep prices low * Weak economies that lack production end up having higher prices, and those weak economies produce budget deficits and the central banks have to print money, causing inflation * The actual definition of inflation is an expansion of the money supply; higher prices are a result of the fact that the currency then buys less * The government wants people to be confused about inflation and where it comes from because they are the source of the problem * By blurring the meaning of inflation, it is easier to shift the blame for economic problems on everything else but monetary policy * CNBC highlighted my call on gold, but omitted all the correct calls I have made, especially 3 recent market predictions: * One: if the Fed raises rates, the stock market is going to tank * Why did I say that the market was going to tank? The conventional wisdom that if the Fed is raising rates, the economy must be stronger - I said if the Fed raises rates it will be doing it into a weak economy. In fact, it probably happened in a recession * Two: I said that there is no historical precedence for this monetary policy because we have been at zero interest rates for 7 years, so the effect of higher rates on the economy appears to have more effect because they have been talking about tightening for years * I also said that if the Fed raised rates, gold prices would rise; it was unanimous that gold would collapse.  Gold is up more than $100 since the initial knee-jerk sellof<br... Our Sponsors: * Check out Aeropress and use my code GOLD for a great deal: https://aeropress.com * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

5 Feb 201625min

* It was another tough day in the stock market today; the Dow Jones finished down 295 points, NASDAQ fared even worse, down 103 points, that's about 2.25% * These 100-point moves are coming quite often now; in the NASDAQ, the transports were hardest hit once again down 204 points - that's almost 3% * When I saw this carnage, I wondered if North Korea had tested another nuclear bomb - early in January the market was down about 250 points and they blamed it on the North Korean bomb test * The markets have been moving about that much every single day! What are the odds that the Korean test had anything to do with the market drop that day? * Everybody wants to find a way to rationalize a weak market, but look, nothing happened today * The financials got clobbered - Goldman Sachs is down 5% on the day, getting ready to break through $150; it was a $200 stock not too long ago * There's a lot of air beneath this chart - is that all oil related? * You might as well blame today's selloff on the fact that Ted Cruz won the Iowa Caucus * The reality is the market is going down because it's a bear market * The market's going down because the U.S. economy is in a recession * There's nothing the Fed can do without loosing credibility or acknowledge that the economy is much weaker that it thought * Going back prior to the rate hike, one of the reasons I constantly said I did not expect the Fed to raise rates is because I knew if they did, they would be in a very bad position * I said, what's going to happen if the Fed raises rates and the stock market starts to decline, how are they going to stop it?  They cant. * Since QE1 in 2009, every time the stock market has faltered the Fed has either launched another round of QE or hinted that it was considering another round * That's what saved the market * That how "Buy the Dips" worked - you had the Bernanke put or the Yellen put * If that put expired with that rate hike in December, then how was the Fed going to stop the carnage? * It can't hint about another round of quantitative easing while it's raising rates * Most people believe that the Fed will not raise rates 4 times this year, maybe only once or twice * But if the market is already collapsing based on the first rate hike, how much lower will it fall if the Fed puts a couple more nails in the coffin? * The only the Fed can save this market is to come out and: * a) Take future rate hikes off the table and * b) Lower rates * They are trying to get the ECB and the Bank of Japan to help, and that hasn't worked - each rally has reversed * The Fed will have to get in on this: sending the ECB and the Bank of Japan in will not do it.  This is a woman's job, and it's going to be Janet Yellen is the only one who can stop the market from falling * We're going to get the jobs number this week - with a first look at it with the ADP number tomorrow but we get the big Non-Farm Payroll number on Friday * The only thing that can really save this market is a horrific jobs number is really bad, then Janet Yellen can talk about not raising rates based on the jobs numbers, so she doesn't have to claim it is based on the stock market * If we get another on of these good jobs numbers, of course it's only good superficially, it's not really good, it's just a high number, then this market's going to tank * Because the Fed is back in the predicament of not cutting rates because they don't want to admit that the jobs numbers are bogus * I happen to be in the supermarket with my 13-year old son and he noticed a help wanted sign on the door, saying, "Part Time Positions Available - Multiple Departments" * They don't want any more full time people - that is the secret to the "strength" in our econo... Our Sponsors: * Check out Aeropress and use my code GOLD for a great deal: https://aeropress.com * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

3 Feb 201632min

* First it was the ECB, and then it was the Bank of Japan, cutting interest rates overnight to -.1% * That is the first time in this 20-year experiment of cheap money - I think they've been at zero, but they've never gone negative until just now * One of the most ironic aspects of the move is that Kuroda, just 8 days ago told the Japanese Parliament that the Bank of Japan was not seriously considering negative interest rates, yet in a span of a week, they went from not considering it, to actually doing it! * In fact, what Kuroda said is that, not only have they moved rates to negative, they may make them even more negative in the future, so no who knows how much more negative they will go * He also hinted that they might expand their asset purchase program, their own Quantitative Easing * That was enough to send global stock market rising, in fact, here in the U.S. the Dow Jones finished up almost 400 points - 396 points - the NASDAQ was up better than 100 points * Obviously this is still a big down month, but not the worse January ever * As I said from the beginning, 2 out of 3 ain't bad, but it won't work * The Fed is going to have to join the rate-cutting party * Right now the Fed is the lone hold-out among central banks and that is still helping the dollar * The dollar was very strong today against the yen and also against the euro - the dollar index now almost back up to 100 * The QE currencies got clobbered * The economic data in the U.S. is not good. We got the first estimate of Q4 GDP * When the year began, everybody was looking for Q4 to be around 2 - 2.5% * As all the horrible economic news poured in throughout the quarter, expectations gradually reduced so that by yesterday, the consensus for Q4 was just .9% * We managed to come in below that at .7% * I have been saying that by the time we get the final revision of this GDP number, we could be below zero.  It doesn't take much to take an initial estimate of .7 to below zero and we still have more data on Q4 coming out, that will bear on this, and I think the data will be bad news * The only way the government could manufacture a GDP of .7 was to pretend that the inflation rate was just .8, and of course, the Fed supposedly have this 2% target and they need to raise rates to get to 2% * That means nominal GDP is only going up 1.5%, which means if the inflation rate is actually higher than 1.5%, then we are in a contraction * In fact, I've pointed this out many times before, if we had an honest look at inflation in the GDP, I think it would reveal that the economy has been in recession for almost the entire recovery, which makes more sense to me, because this recovery feels a lot like a recession * It's not like any other recovery we've ever experienced, and maybe that's because it's not a recovery - it's a recession * I think the recession is going to get a whole lot worse, because of what's going on * The way the media has been spinning this all day, even though they have reported that the GDP is .7, they are reporting that for the entire year, GDP grew by 2.4% for 2015. * Just Google it yourself: any article on the U.S. economy and GDP states that the economy grew by 2.4% in 2015 * That's not true! The actual growth rate is 1.8% * If the economy grew by 1.8%, why is the media spinning the story at 2.4%? * Here's what's going on: if you just measure the increase in GDP from December 31, 2014 through December 31 2015, the increase is 1.8%.  That is how to measure the GDP.  It grew 1.8%. * The government doesn't want to admit that because 1.8% is a pretty low number, the lowest it's been in 3 years, and why would the Fed wait for the lowest annual growth rate in 3 years to finally raise rates, in fact why did they wait for a quarter when it was... Our Sponsors: * Check out Aeropress and use my code GOLD for a great deal: https://aeropress.com * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

30 Jan 201629min

* As I said in my last podcast, when the the Federal Reserve issued its press release yesterday at 2:00pm, Janet Yellen did not give the markets they were hoping for; in a way, it was almost as if she threw them an anchor instead, because the Dow Jones ended up falling about 200 points as a result of the disappointing statement * The statement was dovish, but it wasn't dovish enough, and even though the Dow recovered about half those gains, I think the market is still on the defensive, given the fact that Janet Yellen still did not veer from the projected rate hike path, even though the Fed went out of its way to say that the tightening would be very gradual and that rates would still be low for a long time * And the Fed will continue reinvesting all all the maturing bonds, so the balance sheet will not shrink at all * They will continue to reinvest interest and principal payments, meaning the balance sheet will continue to grow, so it's still QE, just a slimmed down version * But I do expect full-blown QE4 to come before the November election * I do believe that this is the first step in a reversal of policy because Janet Yellen did acknowledge that economic growth slowed last year * In fact, it slowed more at the end of the year, as we will see when we get the first look at the Q4 GDP tomorrow; I think the economic slow-down is continuing in 2016 * The Fed also said that they were monitoring the financial and global markets and will take in consideration the effects that these might have on economic growth, inflation and employment * Obviously, the effects on economic growth are going to be negative - it's the reverse wealth effect * The Fed puts a lot of stock in the wealth effect, but it's a two-edge sword * The Fed statement also mentioned that they are still targeting 2% inflation but that they're not quite there, and expressed concern that they might not meet that goal * To me, acknowledging the economy is slowing, going out of their way to mention that they are monitoring the global economy is an easing from their rhetoric * The Fed is going to have to do a lot more than that subtle suggestion * I think it is enough to turn the dollar; it has been weakening across the board today * Oil prices have moved up a bit * Gold stocks have actually done a little bit better than gold - gold and silver were both hit today: gold was down about $10/11, silver was down about .30 * There was a huge sell order that came in early in the morning and just knocked the markets down in about a minute, which has been typical * It looked like the metal was poised to continue to move higher * We'll see what happens tomorrow when we get the GDP * But one of the reasons it looked like today should have been a big day for gold was the economic news that came out early this morning on December Durable Goods * They were looking for a +.2 increase, following a 0% gain in November * Instead, first they revised the November's number to -.5 and then, instead of improving, we dropped 5.1 - Huge decline! * You have to go back to the '08 financial crisis to find a Durable Goods that bad * It gets worse when you look at the details * Strip out transportation: they were looking for zero, instead we got -1.2 * On top of that, they took last month's -.1 and made it -.5 * The worst one is Core Capital Goods: last month was down .4 and we got -4.3 * Year-over-year Capital Goods is down 7.5% * So, given this number and the Fed's statement yesterday, I expected gold to build on its momentum, but for that big sell order that happened early in the morning * The gold stocks held up today, despite the big drop in gold * I expect a rally tomorrow if we get a weak GDP number, and now a lot of people are looking for a weak... Our Sponsors: * Check out Aeropress and use my code GOLD for a great deal: https://aeropress.com * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

29 Jan 201627min

* The Mario Draghi "No-Limits"-inspired rally from Thursday and Friday of last week ended on Monday with the Dow Jones down just over 200 points; the NASDAQ was down about 75 points, so an even bigger percentage drop * But today the market reversed; the Dow actually recouped 100% of what it lost, it rose 282 points by the close * A lot of volatility in the oil markets; down yesterday and up above $30/barrel today * The bigger action today was in gold, up another $12 or so, the highest price for gold since the first week in November, last year * Gold stocks had a big up day today, but they still have to rise about 8% to get back to where they were when gold was the price it is today * Some of the battered down currencies in the commodities space had a good rally; the Canadian dollar and the Aussie dollar * I think what the markets are preparing for is some type of statement from the Fed tomorrow; they began their 2-day meeting today and they will release a statement - there's no press conference * People are looking for the Federal Reserve to acknowledge some type of change in the economy and therefore soften their stance on their 2016 rate increase projection * The last time we heard from Janet Yellen, the Fed was on track for 4 rate hikes in 2016, and since then, no one has said anything to contradict that, despite what has happened in the U.S. and global markets * Perhaps this recent market rally will give Janet Yellen a reason not to show her hand * Of course, if she disappoints the markets and continues to pretend everything is great, this market's going down hard and all the gains will be surrendered * Maybe she'll try to walk a middle ground by acknowledging the problems in China and in the oil market and say that the Fed is monitoring the situation in case there us unexpected spillover to the U.S. economy which is still otherwise in great shape * She may save face by suggesting that if these outside influences somehow wash up on our shores, and they effect employment and inflation, maybe it will adjust its policy *  I'm not sure if that will be enough for the market; if the market sells off, the Fed is going to have to come back and quickly release more dovish rhetoric * I read an article on Monday's Wall Street Journal and I posted it on my Facebook pageand it really was the equivalent of, This Time It's Different * The headline was, "Recession Signals are Flashing Red" - they've been flashing red for a long time and the WSJ has been ignoring it * The article says that, despite all the bad economic events and data that in the past have led to recession, that this time it's different * The article tells us why we don't have to worry this time, while acknowledging the bad data and events, they say we can rest easy because we have this really strong labor market, and in prior recessions the labor market wasn't as strong * Therefore, since the labor is so strong, we can ignore all the other signals that seem to be flashing recession * I have said many times on this podcast, there is no strong labor market; it exists only in the eyes of statisticians who simply look at a rate of 5% and ignore how we got there * They want to ignore the millions of people who have left the weak labor market and millions more who have settled for part time jobs * So the weak labor market is consistent with all the other data that the WSJ is acknowledging, but tells us to ignore * If we counted all the people outside of the labor market who are discouraged as unemployed, and we also counted all the underemployed people, and the unemployment rate was over 10%, then the WSJ would have to say, "Well, it's a recession!" * How can a recession wait for the government to decide how it ... Our Sponsors: * Check out Aeropress and use my code GOLD for a great deal: https://aeropress.com * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

27 Jan 201629min

* The U.S. stock market ended the week with a 2-day rally, in fact the Dow Jones closed better than 200 points today, to about 1690 *  NASDAQ, even stronger, up 119, closing at almost back up to 4600 * The rally actually began early yesterday morning, and not just in stocks * Oil had a huge rally, in fact, today alone, crude was up $2.72 back above $30, at $32.25 * What sparked the rally was comments made by Mario Draghi at an ECB press conference that followed their official statement that they were leaving interest rates unchanged - they are already negative * Right about that time, the Dow futures were already down 100 points and it wasn't looking good for the open of the U.S. stock market * But then, in Draghi's press conference, he said there was no limit to what the ECB is prepared to do to generate more inflation in Europe * He strongly hinted that in the next meeting in March, they may announce additional stimulus * He saw the weakness in the markets and decided to take one for the Fed, because ultimately it's the Federal Reserve who has to come out with the "Whatever it takes" comment" to shore up the markets * I don't think the ECB is going to be enough, even if Japan joins the party, it won't be a real party until the Federal Reserve shows up * This was enough to cause a small, short-covering rally * What's interesting, though, about the Draghi comments, is that he specifically addressed the problems of low oil prices and low food prices * Do you think the population of Europe worries that food is too inexpensive? * Is it really so important that gas is more expensive in Europe? * None of these are real concerns, and the proof is, if they really wanted the prices to be higher, they could just adjust the Value Added Tax to increase prices to exactly 2% * Why print all this money, hoping that the result is higher gas prices? * The truth is, the price of gas and food in Europe is not the problem - Mario Draghi knows its not the problem * He wants to create inflation to prop up the equity markets * But the press takes Draghi at his word, that inflation is the problem * Stock prices are the prices they are worried about being too low * They also want more inflation to mitigate the effect of government-mandated higher wages * So the one motivating factor behind Draghi's comments was not food or gas prices * Obviously lower food and gas prices help the European economy * All the markets went up on the hint that the ECB is going to further stimulate the economy * That proves that the only reason the stock market has rallied is because the central banks - it's not about the fundamentals * The Fed will have to capitulate and acknowledge that more stimulus is coming * The press is focusing on the idea that the Fed will slow down its initial goal of 4 rate hikes in 2016 * But that's not enough * If the Fed tightens more slowly, and the ECB and Japan are easing, then the story is still about the tighter U.S. monetary policy vs Europe and Japan, which will continue to create the global problem of a high U.S. dollar * We aren't going to get drunk on Europe's liquor - we need our own bartender pouring the drinks * Is it enough to get a short-covering rally? Sure. * Nothing goes down in a straight line * We don't know that Draghi will actually deliver stimulus in March. What if the price of oil goes up above $40/barrel before then? * Mario Draghi went out of his way to praise Janet Yellen, agreeing with the Fed's December rate hike decision * Ironically, the U.S. economy is doing better than Europe, but the U.S. economic data is getting worse, and in Europe it is improving * By the time all the revisions are done, Our Sponsors: * Check out Aeropress and use my code GOLD for a great deal: https://aeropress.com * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

23 Jan 201623min

* The bear market in global stocks continues, and I believe we're in a bear market in the U.S. * Technically the major averages are not quite down 20%, although some of the averages are * Transports were down 30% from their highs * The Russell 2000 was down more than 25% * Many individual sectors are way down into bear market territory, as are some individual stocks * IBM hit a new 6-year low; and, of course, IBM is the poster boy for share buy-backs * Imagine how much shareholder money has been flushed down the toilet buying back stock at over $200/sh and now we're looking at 12o and falling * But remember: all bear markets begin as corrections * The bear market of 2001, when the S&P was cut in half, and the NASDAQ fell by 80%, started as a correction * The same thing in 2008 - they were calling that a correction, too, until they realized that it was a bear market * In fact, the main thing I am hearing today is the comeback - the Dow had a huge comeback because it was down more than 560 points at the low and it closed down at just 249 * The NASDAQ was down more than 160 and it closed down only 5 * Had we closed at the lows of the day maybe we would be closer to a short-term bottom * This is another short-covering inter-day rally creating a slippery slope of hope for the market to continue to slide down * Today, we have hit the most 52-week lows in any month since September of 2008 * Earlier in the day, we were showing the biggest monthly point drop in the history of the stock market * It's not just the worst January, it's the worst month of any year, ever * The market has got to be telling us that not only are we in a bear market, but we are in a recession * The market is forward-looking: it is telling us that we are in a recession * The bond market is priced as if we are in a recession * Maybe that is because we are in a recession * All the economic data indicates a severe recession * The market is behaving as though something bad is happening - we haven't seen action like this since 2008, yet people are dismissing all of this evidence * If it walks like a recession, quacks like a recession, smells like a recession, it is a recession * There are now more people acknowledging that the Fed should not continue raising rates in the near future - an article in the Guardian says:"Janet Yellen and Fed left with face full of egg after interest rate rise blunder" accuses the Fed of raising rates too early * The problem isn't that they raised rates early, it is that they raised them too late * Actually the real problem is that they never should have lowered rates to zero in the first place * I said this from the beginning: They sealed their fate as soon as they dropped rates to zero - no matter when they raised rates it would be a disaster, and the longer they waited it would be a disaster * What is ridiculous is that the Fed wants us to believe that they can raise rates, after leaving them at zero for so long, and that we could sometime just be fine * The narrative that Ben Bernanke, Janet Yellen and the Obama administration have been selling is that they saved the economy * The economy is in much worse shape now than it was 7 years ago * Instead the Fed's poisonous cure made us sicker than ever - That is what I wrote in "Crash Proof" * When I forecasted the bursting of the real estate bubble and the Great Recession and financial crisis, I said the economy could withstand that * What would kill it was the Fed's cure, they came up with the exact remedy I was afraid they would and it is having this exact effect Our Sponsors: * Check out Aeropress and use my code GOLD for a great deal: https://aeropress.com * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Boll & Branch: https://boilandbranch.com/SCHIFF * Check out Infinite Epigenetics: https://infiniteepigenetics.com/GOLD * Check out Justin Wine and use my code SCHIFF20 for a great deal: https://www.justinwine.com Privacy & Opt-Out: https://redcircle.com/privacy

21 Jan 201629min