print-icon
print-icon

Peter Schiff: Jim Rickards Is Wrong About Inflation And Cathie Wood "Believes Her Own Bullshit"

Tyler Durden's Photo
by Tyler Durden
Wednesday, Dec 22, 2021 - 06:45 PM

Submitted by QTR's Fringe Finance

On my latest podcast, and my last podcast of 2021, I had the pleasure of speaking with my favorite economist, Peter Schiff. Peter is an American libertarian, stock broker, financial commentator, and radio personality. He is CEO and chief global strategist of Euro Pacific Capital Inc.

I’m glad I got to talk to Peter because I wanted to get his take on a couple of things. First, I wanted to get his take on this week’s interview with Jim Rickards, where Rickards asserts that inflation has hit its peak, that the price of gold may stagnate next year and that the dollar has to get weaker in order for gold to rise.

Schiff told me:

"I think he's probably wrong. I don't think he has as good an understanding of inflation as he thinks. Is there a chance 2022 inflation can clock in below the 7.2% we're likely to get for 2021? I mean, it's possible. It's not going to be anywhere near 2%, but could it be lower? It could, but I think there's as good a chance that it'll be higher - and 2023 will probably be higher than 2022. I think we're in the early stages of a rather substantial inflationary period."

He continued:

"Inflation is the increase in the money supply, which Rickards acknowledges, but he just for some reason doesn't think the money is out there. That money is out there and it's making its way into the real economy. Look at our trade deficits. This is all money that's being printed and being spent."

In addition, Peter talked about fund manager Cathie Wood at ARK Invest, who I wrote about yesterday for secretly changing the language in one of her investor letters where she predicts her future returns. Schiff said about Cathie Wood:

"I don't think she's like, lying. I think she actually believes her own bullshit. That's the problem. She's been put up on this pedestal and everybody thinks she's so smart because she did something really dumb and it paid off. She just bought the most overvalued crap, and in doing that, the price went up. And now she thinks she's so smart and she has believed her own press clippings. She's completely irrational. The lawyers need to realize that their lawsuits are going to come. Investors are going to say 'I put my money into this fund' because she basically guaranteed me I was going to make 30-40% a year..."

He continued, talking about her recent 40% annual gain estimates:

"You don't make those kinds of forward looking statements with that degree of certainty in the litigious environment like we have in the United States. You're just asking for trouble. I think to me it's almost a sign of desperation on her part. She sees her funds going down, she has to plug up these holes..."

I also wanted to get Peter‘s take on Democrats’ inability to understand basic economics, something I have been harping on since President Biden shut down U.S. oil projects and then spent the first 6 months of his term wondering where high oil prices were coming from.

This government idiocy was exemplified this week in Tweets by Elizabeth Warren, who has been blaming inflation not on big oil, not on big tech, but on big grocery. Didn’t know there was a “big grocery” to fear in this country? Boy, were you wrong.

“Giant grocery store chains force high food prices onto American families while rewarding executives & investors with lavish bonuses and stock buybacks. I'm demanding they answer for putting corporate profits over consumers and workers during the pandemic,” Warren Tweeted earlier this week.

Schiff responded:

"It's flawed for so many reasons. Corporations are private enterprises, they're owned by their shareholders, who have invested in those companies because they're trying to earn a return on their investment. Corporations are supposed to put their owners first! That being said, the way to maximize profits for shareholders is to put your customers first, because if you don't, you're going to lose them!"

He continued:

"Why do you think we have the expression 'the customer is always right?' This is the beauty of capitalism. It's the government - when the government tries to put the customer first, you get a lousy experience. When you go to the Post Office or the DMV - that's what you get. Because they're not profit seeking companies and they couldn't give a damn about the customer."

Schiff adds:

"Stores have to rise their prices because their costs are going up! If they don't, they'll go out of business!"

I also wanted to ask Peter his thoughts on Joe Manchin mansion choosing to vote no  on the Build Back Better bill. Just a couple days ago, I wrote an article called “Joe Manchin Saves America” that argued that Manchin’s “no” vote was exactly what Democrats deserved - and exactly what was best for our country right now. Peter offered his thoughts on my podcast. 

Finally, we discussed the idea of whether or not “bond vigilantes” can come out of the woodwork to force the Fed’s hand in hiking rates. This is something I wrote about days ago, and also asked my recent guest Jack Boroudjian about.

"The Fed has killed the bond vigilantes," Schiff tells me. 

As a reminder, my podcast listeners usually always get 10% off a subscription to my blog. For the holidays, I am extending a 20% off subscription price that literally never changes for as long as you have your subscription, regardless of inflation: Get 20% off forever

Finally, you can listen to my podcast with Peter, here, for free:

0