Markets Still Fooled as Fed Plays “Let’s Pretend” – Ep. 86
The Peter Schiff Show Podcast
Peter Schiff
4.6 • 5.9K Ratings
🗓️ 30 May 2015
⏱️ 18 minutes
🧾️ Download transcript
Summary
* Short week closed with some horribly bad news
* People are not paying attention to the data; they are paying attention to the Fed
* Government released revision to the GDP: -.7
* The assumption of deflation is cooked into the number
* Most Q2 data is weak
* Q1 Corporate profits plunged by 5.9%
* JP Morgan announced 5,000 layoffs
* Corporations are already levered up to the max
* May Chicago PMI plunged back down to 46.2 - close to March's -year low
* April Durable Goods fell .5
* March Services PMI fell to 56.4 - second monthly drop
* May Dallas Fed Manufacturing crashed to -20.8; fifth consecutive monthly decline
* The Fed has never predicted a recession; in fact they have forecasted economic growth while in a recession
* Bloomberg Consumer Comfort Index: fell for the 7th consecutive week
* There are fewer good jobs available and if someone loses their job the are likely to have to take one they are overqualified for
* The Fed is too concerned about maintaining the illusion of prosperity to allow genuine prosperity
* They are propping up the stock market and the housing market, pretending everything is OK, and allowing the government to continue deficit spending
* People still think the Fed will raise interest rates; the most we would get is a trivial hike< just to say they raised rates to get things back to normal
* There is no more normal anymore; the new normal is interest rates at zero and perpetual QE until the whole thing blows up
* How can we expect to learn from our ancestors when we can't even learn from our own mistakes?
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Transcript
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| 0:00.0 | Well, it was a holiday shortened week, but we still had a lot of economic data that came |
| 0:15.8 | out Tuesday through Friday, almost all of it bad. |
| 0:19.5 | And some of it wasn't just bad. |
| 0:20.8 | It was really horribly bad. |
| 0:23.4 | But nobody seems to care, right? |
| 0:25.1 | Because everybody is still paying attention to all the rate height talk coming from the |
| 0:29.8 | Federal Reserve, right? |
| 0:30.8 | The Federal Reserve keeps talking about raising rates if the economy continues to strengthen. |
| 0:36.3 | And that is the key that everybody overlooks. |
| 0:39.2 | It's contingent on the economy strengthening, but all the evidence indicates that that's |
| 0:44.1 | not the case. |
| 0:46.1 | The markets, though, you know, were down on the week because people are worried about |
| 0:52.3 | rate hikes coming from the Fed. |
| 0:53.9 | Despite all of this bad economic news that would suggest otherwise, I guess to maybe |
| 0:59.3 | some traders wanted to sell in May and go in way. |
| 1:02.8 | So the, you know, the markets were generally lower on the week. |
| 1:05.8 | The dollar was a bit higher and gold a bit lower. |
| 1:10.2 | But again, based on how bad the economic data was, you would have expected the dollar to |
| 1:15.6 | have had a bigger reaction down and gold up, except again, people are not paying attention |
| 1:20.5 | to the data. |
| 1:21.8 | They're paying attention to the Fed. |
| 1:23.7 | And again, that shows you how manipulated this market really is because it's all really |
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