• Peter Schiff, chief economist of Europac, has warned about the incoming of a new great depression in America.
• He stated that official Consumer Price Index (CPI) numbers are designed to mislead the public and that it will be worse than the one from the 1930s.
• He criticized the way CPI is calculated and believes high interest rates won’t be able to control inflation.
Peter Schiff Warns About an Incoming Great Depression
Economist Peter Schiff, best-selling author and Chief Economist of Europac, has warned about an upcoming economic crisis that will unleash a new Great Depression far worse than what was seen in the 1930s. In an interview, he stated that this crisis would be partly caused by increasing public spending which would lead to higher inflation levels and affect the qualification of U.S. public debt.
How Inflation Numbers Can Be Misleading
In addition to warning about the coming depression, Schiff also criticized how Consumer Price Index (CPI) data is used to determine inflation, stating that it was designed to give a low result and that “you basically have to double the official numbers to get a better idea of what’s actually happening with prices”. According to him, this should indicate real inflation closer to 10%.
High Interest Rates Not Enough To Control Inflation
Schiff also remarked that high interest rates will not be able to control inflation as “interest rates are prices [and] it’s going up just like everything else”. He believes that Americans will suffer even if they don’t lose their job due to their loss of purchasing power resulting from high prices.
Peter Schiff’s Solution To The Problem
The economist suggested that instead of raising debt ceilings which only worsen the problem, they should stop increasing them as it would be a solution for it all in itself.
Conclusion
It is clear from Peter Schiff’s comments on this situation that there is much cause for concern when one considers what lies ahead for the US economy due its inflation levels and potential debt crisis combined with a lack of effective solutions currently being proposed by those in power positions within politics or economics circles today.