Peter Schiff of Europacific Capital continues to sound the alarm on the risks of the government’s mounting debt load and the Federal Reserve’s low interest rate policy.
Like Roubini and some other doomsayers, he employs the “perfect storm imagery.”
From a piece in King World News:
The perfect storm is the real fiscal cliff that we’re going to go over. The real fiscal cliff is when we can’t borrow any more money because our creditors wake up to the fact that we’re no good for the debt and interest rates start to rise.
They (interest rates) rise sharply and then we have to choose between default and collapse, or runaway inflation. That’s really the perfect storm and unfortunately we are sailing right in to it.
Indeed, should interest rates rise, it will become increasingly difficult to finance the debt. However, Treasury market bears have been calling for interest rates to rise for nearly a decade, yet rates only continue to tumble.
Business Insider Emails & Alerts
Site highlights each day to your inbox.