- US Headed for Dollar & Sovereign Debt Crisis on Scale Never Experienced – Peter Schiff
The US Federal Reserve has never been right in its policies and has set up the American economy for an even bigger crisis, said economist Peter Schiff at the Virtual Investor Day Conference. According to Schiff, the United States is entering the final chapter of the book the former Fed Chair Alan Greenspan started to write, unleashing the loose money policy that blew up the dot-com bubble.
“When that bubble popped, instead of admitting his mistakes, Greenspan ignored them and tried to revive the economy by inflating a bigger bubble in the real estate market than the bubble that had just popped in the stock market. And the Fed succeeded in inflating that bubble. But that was not a success. It was a failure.”
People were using the inflated value of their homes as ATMs, and that drove consumer spending. They were living beyond their means and nobody was saving, Schiff said. “So, the whole economy was distorted by the malinvestments and bad decisions that were being made as a result of artificially low interest rates.”