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Peter Schiff Warns: ‘The Fed Can’t Raise Rates ... This Is a Gigantic Bubble’

Name: CNBC


Fast Money

Name: Fast Money


Peter Schiff

Name: Peter Schiff

Employment: Euro Pacific Capital Inc.

Position: CEO

, Melissa Lee

Name: Melissa Lee

Event location
Not online media
03/23/2016 08:01 pm
Tom (staff)
MP4 (1280x720) Use clipper to adjust file type
RUSH TRANSCRIPT LEE All ░░░░░░░░ We talked about volatility ░░░░░░░░ asset classes which brings ░░░░░░░░ to the move of ░░░░░░░░ day the GLD the ░░░░░░░░ ETF falling nearly 2 ░░░░░░░░ The yellow metal is ░░░░░░░░ best and safest best ░░░░░░░░ a stalling market and ░░░░░░░░ s here to tell ░░░░░░░░ why Time to go ░░░░░░░░ Hunting with Euro Pacific ░░░░░░░░ CEO Peter Schiff Peter ░░░░░░░░ good to have you ░░░░░░░░ Thanks for having me ░░░░░░░░ Forgot how casual you ░░░░░░░░ UNKNOWN MALE Yeah LEE ░░░░░░░░ good Peter let s ░░░░░░░░ to gold You ve ░░░░░░░░ bullish gold for a ░░░░░░░░ time What makes it ░░░░░░░░ compelling in this environment ░░░░░░░░ Well first of all ░░░░░░░░ the stock market gold ░░░░░░░░ still up considerably on ░░░░░░░░ year It s down ░░░░░░░░ because the fed is ░░░░░░░░ to its old trifnlgts ░░░░░░░░ think they are bluffing ░░░░░░░░ April rate hike and ░░░░░░░░ played that game all ░░░░░░░░ year They waited until ░░░░░░░░ to finally pull the ░░░░░░░░ a tiny rate hike ░░░░░░░░ that was a disaster ░░░░░░░░ re off to the ░░░░░░░░ stock market start in ░░░░░░░░ The only reason the ░░░░░░░░ rallied is because they ░░░░░░░░ and now all of ░░░░░░░░ sudden they are testing ░░░░░░░░ water on backtracking again ░░░░░░░░ I don t think ░░░░░░░░ are going to like ░░░░░░░░ happens LEE Do we ░░░░░░░░ stocks to go down ░░░░░░░░ order for gold to ░░░░░░░░ higher SCHIFF No In ░░░░░░░░ the funny thing is ░░░░░░░░ went down today because ░░░░░░░░ are afraid of the ░░░░░░░░ raising rates What happened ░░░░░░░░ last time the fed ░░░░░░░░ rates gold went way ░░░░░░░░ so if anything if ░░░░░░░░ fed does that again ░░░░░░░░ the stock market tanks ░░░░░░░░ will get the safe ░░░░░░░░ bid but ultimately I ░░░░░░░░ t think the fed ░░░░░░░░ to put another pin ░░░░░░░░ this bubble I agree ░░░░░░░░ re in a recession ░░░░░░░░ don t think we ░░░░░░░░ going in a recession ░░░░░░░░ think we re in ░░░░░░░░ right now and I ░░░░░░░░ t think the fed ░░░░░░░░ to add a bear ░░░░░░░░ to a recession I ░░░░░░░░ they are going to ░░░░░░░░ this bubble going They ░░░░░░░░ going to talk as ░░░░░░░░ they can raise rates ░░░░░░░░ they don t want ░░░░░░░░ admit that this is ░░░░░░░░ bubble but they don ░░░░░░░░ want to let the ░░░░░░░░ out so I think ░░░░░░░░ is a buying gold ░░░░░░░░ MALE So for adortion ░░░░░░░░ lot of moves gold ░░░░░░░░ up and the dollar ░░░░░░░░ up on the same ░░░░░░░░ In your view can ░░░░░░░░ correlation be broken The ░░░░░░░░ correlation of dollar goes ░░░░░░░░ and gold goes up ░░░░░░░░ the dollar and gold ░░░░░░░░ a long period of ░░░░░░░░ go up together SCHIFF ░░░░░░░░ they could but I ░░░░░░░░ t think that s ░░░░░░░░ s going to happen ░░░░░░░░ think that the dollar ░░░░░░░░ going to go down ░░░░░░░░ In fact against most ░░░░░░░░ the dollar is down ░░░░░░░░ year The dollar was ░░░░░░░░ today but if you ░░░░░░░░ at the trend I ░░░░░░░░ the trend in the ░░░░░░░░ has reversed because the ░░░░░░░░ gained for years based ░░░░░░░░ the idea that the ░░░░░░░░ was going to be ░░░░░░░░ rates but I know ░░░░░░░░ they can t do ░░░░░░░░ and the minute they ░░░░░░░░ rates they put us ░░░░░░░░ back into recession and ░░░░░░░░ have to cut rates ░░░░░░░░ have to relaunch qe ░░░░░░░░ ultimately the dollar is ░░░░░░░░ to sell off so ░░░░░░░░ s not just the ░░░░░░░░ the rumor and sell ░░░░░░░░ fact It s buy ░░░░░░░░ rumor and sell because ░░░░░░░░ rumor is not true ░░░░░░░░ the fed can t ░░░░░░░░ deliver the rate hike ░░░░░░░░ the market expected GRASSO ░░░░░░░░ I hear you The ░░░░░░░░ on gold gold probably ░░░░░░░░ higher for different reasons ░░░░░░░░ you ve been bashing ░░░░░░░░ fed forever and you ░░░░░░░░ interest rates were going ░░░░░░░░ 10 percent because the ░░░░░░░░ was financing something that ░░░░░░░░ couldn t do in ░░░░░░░░ economy The statements about ░░░░░░░░ economy ultimately get you ░░░░░░░░ a place where first ░░░░░░░░ all as far as ░░░░░░░░ m concerned the market ░░░░░░░░ remain more irrational and ░░░░░░░░ think you must believe ░░░░░░░░ has to have been ░░░░░░░░ the past six years ░░░░░░░░ it s been going ░░░░░░░░ longer than someone can ░░░░░░░░ solvent not saying you ░░░░░░░░ the point is how ░░░░░░░░ do you try to ░░░░░░░░ against the fed in ░░░░░░░░ environment where the fed ░░░░░░░░ proven they can do ░░░░░░░░ they want and people ░░░░░░░░ have tried to game ░░░░░░░░ fed have been wrong ░░░░░░░░ Betting against the fed ░░░░░░░░ been very successful The ░░░░░░░░ has made a lot ░░░░░░░░ mistakes Look at disaster ░░░░░░░░ happened in the housing ░░░░░░░░ because of the fed ░░░░░░░░ there were people who ░░░░░░░░ a lot of money ░░░░░░░░ being against the fed ░░░░░░░░ Are you talking about ░░░░░░░░ SCHIFF Yeah the housing ░░░░░░░░ inflated over a number ░░░░░░░░ years and if you ░░░░░░░░ against the fed and ░░░░░░░░ gold look where gold ░░░░░░░░ in 1999 2000 It ░░░░░░░░ under 300 an ounce ░░░░░░░░ fed one of the ░░░░░░░░ reasons it s now ░░░░░░░░ 1 200 so buying ░░░░░░░░ is a bet against ░░░░░░░░ fed and that bet ░░░░░░░░ paid off more than ░░░░░░░░ GROSSO I just don ░░░░░░░░ agree with that First ░░░░░░░░ all stocks went from ░░░░░░░░ or 666 UNKNOWN MALE ░░░░░░░░ up GROSSO Went up ░░░░░░░░ and a half times ░░░░░░░░ went from a peek ░░░░░░░░ is down You re ░░░░░░░░ a place where everything ░░░░░░░░ fed has done You ░░░░░░░░ not like fed policy ░░░░░░░░ a pure economic perspective ░░░░░░░░ it may be something ░░░░░░░░ s a road to ░░░░░░░░ Who knows I don ░░░░░░░░ like the fact that ░░░░░░░░ can t normalize interest ░░░░░░░░ either but the reality ░░░░░░░░ that has worked for ░░░░░░░░ prices SCHIFF So what ░░░░░░░░ hasn t worked for ░░░░░░░░ overall economy Why do ░░░░░░░░ think they can t ░░░░░░░░ interest rates why do ░░░░░░░░ think they are still ░░░░░░░░ low after seven years ░░░░░░░░ this is a gigantic ░░░░░░░░ and if the fed ░░░░░░░░ to raise interest rates ░░░░░░░░ ll have a worse ░░░░░░░░ crisis than the one ░░░░░░░░ caused in 2008 and ░░░░░░░░ you can t say ░░░░░░░░ this is a success ░░░░░░░░ is a complete failure ░░░░░░░░ just don t know ░░░░░░░░ yet because the high ░░░░░░░░ t worn off UNKNOWN ░░░░░░░░ I think pumping liquidity ░░░░░░░░ marks that were seizing ░░░░░░░░ and institutions that were ░░░░░░░░ right and left this ░░░░░░░░ the job SCHIFF The ░░░░░░░░ lit the fire and ░░░░░░░░ you re claiming you ░░░░░░░░ get them credit for ░░░░░░░░ it out They didn ░░░░░░░░ put it out They ░░░░░░░░ it out with gasoline ░░░░░░░░ it s coming back ░░░░░░░░ UNKNOWN MALE The fed ░░░░░░░░ trying to reverse course ░░░░░░░░ you re actually going ░░░░░░░░ with the fed if ░░░░░░░░ re bearish here in ░░░░░░░░ sense They want to ░░░░░░░░ this bubble SCHIFF No ░░░░░░░░ They don t even ░░░░░░░░ to admit that it ░░░░░░░░ a bubble Why do ░░░░░░░░ think on this show ░░░░░░░░ they first started doing ░░░░░░░░ when they launched question ░░░░░░░░ they brought interest rates ░░░░░░░░ to zero I said ░░░░░░░░ was a monetary roach ░░░░░░░░ and I said that ░░░░░░░░ a reason because I ░░░░░░░░ once they check us ░░░░░░░░ they can never check ░░░░░░░░ out and that s ░░░░░░░░ they are finding out ░░░░░░░░ now GRASSO Where s ░░░░░░░░ dollar going because he ░░░░░░░░ it s going higher ░░░░░░░░ do you think it ░░░░░░░░ going SCHIFF I think ░░░░░░░░ s going lower because ░░░░░░░░ don t think the ░░░░░░░░ is going to be ░░░░░░░░ to deliver the rate ░░░░░░░░ I think we re ░░░░░░░░ to get back to ░░░░░░░░ maybe even negative I ░░░░░░░░ they are doing QE4 ░░░░░░░░ How much of a ░░░░░░░░ how much worse does ░░░░░░░░ get SCHIFF I think ░░░░░░░░ recession GRASSO We re ░░░░░░░░ in a recession crosstalk ░░░░░░░░ Hold on Let him ░░░░░░░░ This is his view ░░░░░░░░ Never know you re ░░░░░░░░ a recession until afterwards ░░░░░░░░ didn t tell us ░░░░░░░░ in the great recession ░░░░░░░░ 2008 until it was ░░░░░░░░ over right so I ░░░░░░░░ by the time they ░░░░░░░░ the numbers I think ░░░░░░░░ recession that we re ░░░░░░░░ now probably began at ░░░░░░░░ end of last year ░░░░░░░░ How much worse does ░░░░░░░░ get when they raise ░░░░░░░░ is what I m ░░░░░░░░ SCHIFF I don t ░░░░░░░░ they are going eventually ░░░░░░░░ market is going to ░░░░░░░░ force higher rates LEE ░░░░░░░░ SCHIFF But I think ░░░░░░░░ recession is going to ░░░░░░░░ greater than what we ░░░░░░░░ call the great recession ░░░░░░░░ we ll have to ░░░░░░░░ that one because this ░░░░░░░░ is going to be ░░░░░░░░ LEE Going to be ░░░░░░░░ worst recession SCHIFF And ░░░░░░░░ think whoever replaces Barack ░░░░░░░░ is going to inherit ░░░░░░░░ worse recession than the ░░░░░░░░ he inherited from Bush ░░░░░░░░ All right Peter thank ░░░░░░░░ for stopping by SCHIFF ░░░░░░░░ pleasure LEE Fiery discussion ░░░░░░░░ him.”
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