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| Economist Peter Schiff warns Americans to brace for significant inflation |
Economist Peter Schiff warns that inflation in the United States is about to worsen significantly, resulting in a sharp increase in the cost of living for Americans. Schiff pointed out that the Federal Reserve's funding of a "massive bailout" for banks will ultimately cost Americans a lot of money.
Schiff explained in interviews this week that recent bank failures, such as Silicon Valley Bank and Signature Bank, were caused by government intervention in the economy. He noted that the Fed's keeping interest rates at zero for an extended period resulted in banks investing in long-term, low-yielding U.S. Treasuries and mortgage-backed securities. Additionally, banking regulators pushed banks into risky investments due to favorable accounting treatment, which created the problem, according to Schiff.
The economist warns that inflation is going to get much worse because the Fed has already returned to quantitative easing, whether or not it admits it. Schiff stressed that Americans will pay for the bank bailouts, and the Fed's balance sheet and money supply will increase, causing consumer prices to rise significantly.
Schiff's warning is particularly relevant as the Federal Reserve recently raised interest rates by 25 basis points. However, Schiff argued that future rate hikes would be pointless because any effect would be more than offset by the Fed's quantitative easing. Americans should brace themselves for a significant increase in the cost of living in the near future.
