12/16/2008 Part 4/4 Peter Schiff On Kudlow & Co: FED & The Markets
July 02, 2009 : Posted by: admin : Category: protecting wealth : Add Comment
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Duration : 0:2:55
July 2nd, 2009 at 2:03 am
Did you even read …
Did you even read what I just said? SCHIFF NEVER SAID TOO MANY HOMES WAS THE PROBLEM, HE SAID IT IS THE SYMPTOM. Homes were overproduced as a result of the problem. Understand your error. If all we ever produced with our capital was homes, everything else would get underproduced. Malinvestment of capital is REAL. It’s not a Keynesian myth, the Keynesian myth is that the ets are illiquid. They’re only illiquid FROM PRICE FIXING, and it was PRICE FIXING OF INTEREST RATES THAT GOT THEM THERE.
July 2nd, 2009 at 2:03 am
Peter is so Direct …
Peter is so Direct and Blunt that they cannot understand him.
Its like he is speaking a different language.
He tells it like it is. No one is telling him what to say.
July 2nd, 2009 at 2:03 am
If we had sound …
If we had sound money and a free market, we would naturally be PRODUCING things. We are a VERY SOCIALIZED country. If labor wasn’t tied up in unproductive channels (i.e., in government), or if people weren’t subsidized to remain idle, it is very possible that we would have EVEN MORE HOMES. Saying that there are “too many” houses is a lot like saying there is “too much” gold, or something to that effect. Or, since oil prices have fallen, there is “too much” oil.
July 2nd, 2009 at 2:03 am
The problem is NOT …
The problem is NOT the number of homes, nor the “over production” of homes. The idea that the problem is “too many” houses is actually a variant of Keynesianism, because it is suggested that the problem is that prices are FALLING (which is a GOOD thing). No. The problem was the WAY THE HOMES WERE FINANCED (i.e., through INFLATION, rather than through making real payments).
July 2nd, 2009 at 2:03 am
Look, I love Peter …
Look, I love Peter Schiff. My disagreement is merely with that particular ertion. I have been studying Austrian economics since 1999. I do say you are still mistaken, yet right about some of what you say. Yes, inflation causes malinvestment/malconsumption. However, the government/inflation NEVER stimulate consumption beyond the REAL MEANS OF PAYMENT, which consists of real wealth. My point is this:…..
July 2nd, 2009 at 2:03 am
Schiff never said …
Schiff never said that overproduction was the cause, the problem, he is stating the symptom, he is stating that foreign capital was malinvested in American consumption. He is absolutely right that the money that went and is currently going into building more homes should be going into factories. He is not saying homes are bad, that we should never product homes, that we wouldn’t have more in a wealthy economy. You’re dead wrong on this and you need to stop it.
July 2nd, 2009 at 2:03 am
I agree with you …
I agree with you that we’d have more homes (and factories, and wealth) with market determined money and interest rates, the capital would be able to flow into the necessary places, the real scarcities. I disagree with you that there was not an overproduction/underproduction malinvestment SYMPTOM with government intervention being the CAUSE. There is a finite amount of world capital and it was going into American consumption when more of it should have been going into factories and exports.
July 2nd, 2009 at 2:03 am
If you want to …
If you want to follow all the the videos of PETER SCHIFF, JIM ROGERS, MARC FABER and RON PAUL I just always go to financialtruth0.blogspot d ot com because then I don’t have to search all over youtube to find them. Anyway thanks for uploading!
July 2nd, 2009 at 2:03 am
I would say you …
I would say you don’t know what you are talking about. Again, the problem wasn’t building houses or over-building, but how they were financed. In a free market, savings-based system, we could very well have even more houses, less the debt you speak of.
July 2nd, 2009 at 2:03 am
You’re on my side, …
You’re on my side, but you don’t know what you’re talking about. Call up schiff on his radio show and tell him he’s wrong if you’re so convinced. Homes can’t be exported and we needed foreign credit and artificial interest rates to afford them. This isn’t the type of production that we needed to get out of debt. Instead, it got us deeper, so stop defending it as though you can never build too many.
July 2nd, 2009 at 2:03 am
I’m so happy to see …
I’m so happy to see more and more people catching on to what Peter is saying. When he tells you to buy gold, he is trying to save your life.
Its a shame for me to find out that only 3 out of the 40 people in my family can figure it out. Its like they dont care. They think everything is going to be A-OK. The dollar will never crash.
How do you get some people to care about whats going to happen to them in a year or two from now??? How about pop-up books?
July 2nd, 2009 at 2:03 am
The same thing …
The same thing happening with houses not clearing the market and inventories piling up happens with labor, as the government props up wages for one group of people, thus keeping many, many others unemployed, as labor doesn’t clear the market. This is why the government ends up causing depressions through efforts to re-flate bubbles. Goods and labor stop clearing the market. That was the Great Depression. This one will be worse, because nominal prices will actually go up.
July 2nd, 2009 at 2:03 am
the market discover …
the market discover clearing prices. Look at healthcare for example. People rightfully understand how unaffordable healthcare is. But they believe the solution is more government interference. If healthcare is unaffordable, that is not due to too much free market, but that the market isn’t being allowed to set clearing prices, through all of the different regulations, licensing laws, and subsidies.
July 2nd, 2009 at 2:03 am
I would still …
I would still disagree with the wording. Inflation-driven bubbles never lead to OVER production of anything, but malinvestment and malconsumption, while diminishing productive capacity. Thus I would say that houses were “over built” in relationship to our productive capacity. If we had a free market, it is quite possible that we would have even more houses. There is going to be a lot of unemployed people. Is the problem going to be “too many” people on earth? No. It is all about letting..
July 2nd, 2009 at 2:03 am
I understand what …
I understand what you’re saying, the homes are perfectly liquid ets, just not at the prices the sellers or lenders now stuck with them want them to be. But I’m not arguing liquid/illiquid, I’m saying that homes were overbuilt relative to REAL demand, which is absolutely true. And instead of prices coming down, the Fed is trying to recreate the artificial demand that made them that high.
July 2nd, 2009 at 2:03 am
lets chat
…
lets chat
energetic fun smart and loves this video 1v
July 2nd, 2009 at 2:03 am
A false economic …
A false economic situation was created by Congress/Fannie Mae and Freddie Mac and the Federal Reserve that caused too many houses to be built. You both are right.
July 2nd, 2009 at 2:03 am
Why the fruck …
Why the fruck should we trust the Fed Govenor. David rockefellers former lapdog. Heres how it works. Private banks own shares in the Fed. Class A B and C shares to be precise. The big banks choose 9 federal reserve governors. And a chairman of course. They choose the governers that will suit the globalist agenda. The fed serves the elite.
July 2nd, 2009 at 2:03 am
thanks man! you too!
thanks man! you too!
July 2nd, 2009 at 2:03 am
God I love Peter …
God I love Peter Schiff! But don’t forget guys that he is not the only financial EXPERT! There are also JIM ROGERS, MARC FABER, and RON PAUL. I always go to financialtruth0.blogspot because there they post all the interviews, and it is easier to keep track of! Thanks for uploading anyway!
July 2nd, 2009 at 2:03 am
No, the problem …
No, the problem isn’t too many houses. That is a keynesian idea, which believes that prices should remain high, and thus if prices fall, do everything to keep them up, and when they can’t clear the market, say the problem is “too many houses.” If houses aren’t clearing the market, that doesn’t mean there are too many houses, but that the price mechanism is not being allowed to function. The government and the Fed are PREVENTING the market from setting clearing prices.
July 2nd, 2009 at 2:03 am
The problem IS too …
The problem IS too many houses. I live in the “recession proof” state of Oklahoma, and even in my more affluent neighborhood, you see vacant houses for sale for 12 months or more. Houses simply aren’t moving here, and builders have slowed down their new construction to a trickle. Home prices here are too high, which have skyrocketed from 50 to 100 percent since 1992. People simply can’t afford houses, the bubble still exists in many states and have yet to pop.
July 2nd, 2009 at 2:03 am
Thus it would make …
Thus it would make more sense to say that homes were “overbuilt” in relationship to economic realities created by the Fed and the government. But if there are people without homes who want one, the problem certainly isn’t “too many” houses. People don’t lack dollars, but the productivity capacity to finance consumption.
July 2nd, 2009 at 2:03 am
we could have even …
we could have even built even more homes with no problems. You have to understand what inflation does, and how it causes capital decumulation and the destruction of savings. Right now we are living through a continued run on real wealth. Suppose you grow blueberries, but all of your customers produce nothing and just give you pieces of paper. The issue isn’t that you overproduced blueberries, but that your trading partners were unloading faux savings, leading to a run on your blueberries.
July 2nd, 2009 at 2:03 am
When the government …
When the government tries to price fix either upwards or downwards, either surpluses are created, or even worse shortages occur (depending on which the government does). The reason why inflation leads to runs on real wealth is because it is a means to finance consumption without production. Thus it is impossible to say that homes were over produced. If the government and the Fed weren’t as big as they are, it is possible that….