Peter Schiff was right.... Archives
Peter Schiff was right....
Peter Schiff, president of Euro Pacific Capital, among others, has been predicting the current economic crisis since 2006.
Just as prices in a free market are set by supply and demand, financial and real estate markets are governed by the opposing tension between greed and fear. Everyone wants to make money, but everyone is also afraid of losing what he has. Although few would ascribe their desire for prosperity to greed, it is simply a rose by another name. Greed is the elemental motivation for the economic risk-taking and hard work that are essential to a vibrant economy.
But over the past generation, government has removed the necessary counterbalance of fear from the equation. Policies enacted by the Federal Reserve, the Federal Housing Administration, Fannie Mae and Freddie Mac (which were always government entities in disguise), and others created advantages for home-buying and selling and removed disincentives for lending and borrowing. The result was a credit and real estate bubble that could only grow -- until it could grow no more.
"Don't Blame Capitalism," by Peter Schiff, The Washington Post, October 16, 2008
November 16, 2008 05:07 PM Caught Our Eye
