Peter Schiff recently appeared on Real America with Dan Ball to talk about the latest employment data and the state of the real estate market. We know there is a lot of doom and gloom in the headlines, but Peter said the situation is actually doomier and gloomier than the headlines suggest.
Dan summed it up this way:
“You just can’t keep spending more than we bring in, printing money and doing what they’re doing within the Biden administration.”
Then he asked a question: “How do I keep my head above water with all this doom and gloom, for God’s sake?”
Peter said it’s actually doomier and gloomier than the headlines suggest and pointed out the jobs data.
If you dig beneath the 999,000 private sector jobs that were created, those were almost exclusively part-time jobs. They’re low-paying jobs. They went to people who already have one or two jobs. The number of Americans working multiple jobs soared almost 400,000, I think, to another all-time record high.”
He pointed out that the economy is actually shedding manufacturing jobs, and the full-time jobs it has added are primarily in the government sector.
We lost 35,000 manufacturing jobs. All this talk about the revitalization of manufacturing is just a bunch of BS. We’re losing these jobs. These are productive jobs. They’re good-paying jobs. Instead, we replace them with more IRS agents. We hired 51,000 government employees added to the payroll. They don’t produce anything but red tape. They actually undermine economic growth. They lead to bigger deficits and more inflation.”
Dan asked about the current situation in the housing market, recalling the money he personally lost in the 2008 crash. He pointed out the insane price of homes in San Diego and wondered how anybody could afford to buy a house given the combination of high prices and rising mortgage rates. “Is there going to be another bubble pop when it comes to the housing market?” he asked.
Peter said, “Absolutely!”
The only way you can afford to buy something is that the price goes down. But the problem is when the price goes down, the banks are in a lot of trouble because that’s the collateral for these loans.”
Peter said we have a bigger problem now than we did in 2008 because banks are losing money on all of their mortgages — not just subprime.
Back in ’08, it was only the defaulted mortgages that were a problem. Now, all of them are a problem because the banks are only earning 3%, 4% on these mortgages. But the cost of money is now 5.2%. So, the banks lose money on every mortgage that is being paid. The entire banking system is completely insolvent.”
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