I don`t think you can blame what may or may not be happening in the gold market on High Frequency Trading (HFT) or even about the volatility in the stock market. You are always going to have program traders, you are going to have people that are buying and selling based based on technical indicators, based on momentum indicators.
By and large, this creates extra liquidity. If it wasn`t for all the people speculating in the market, the markets would be thinner. It would be a little harder to buy and sell stocks if the only people selling stocks were long term investors who wanted out and if the only people buying stocks were long term investors that wanted in - there would`t be that much trading going on.
So I don`t think its the traders that are responsible for the problems.
Peter Schiff is an American businessman, investment broker and financial commentator. Schiff is the CEO and chief global strategist of Euro Pacific Capital Inc.
Apr 1, 2014
Federal Reserve: Dealing With The Genie They Let Out Of The Bottle
At some point its not going to be, "inflation is too low", its going to be, "inflation is much too high." And the pressure on the bond market will be intense, the amount of money the Federal Reserve is going to have to create to artificially supress interest rates will be too much for the economy to bear in the way of dollar depreciation and consumer price increases.
So at some point they are to have to deal with the genie they let out of the bottle. How long can they wait? I do not know. But they are going to wait as long as they can and believe its going to be a huge, huge problem at the time they try to do something about it.
Peter Schiff is an American businessman, investment broker and financial commentator. Schiff is the CEO and chief global strategist of Euro Pacific Capital Inc.
So at some point they are to have to deal with the genie they let out of the bottle. How long can they wait? I do not know. But they are going to wait as long as they can and believe its going to be a huge, huge problem at the time they try to do something about it.
Peter Schiff is an American businessman, investment broker and financial commentator. Schiff is the CEO and chief global strategist of Euro Pacific Capital Inc.
What Economists Assume About Deflation
It is just accepted as economic truth that if consumers felt that prices were going to fall and be 1 percent lower next year, they would not shop. They would not spend any money at all. They would wait a year to get that savings. They would wait a year to save 1 percent.
And they say that and is just accepted without anybody bothering to think how completely ridiculous or asinine such an assumption is. Can you even imagine a circumstance where you need something or wanted something and it costed 100 dollars but you were convinced that at the end of the year you could buy it for 99 dollars, that you would hold off on shopping, that you would not buy it, that you would wait a year and then buy it because it would be a dollar off? That you would go without it for an entire year in order to save that dollar. And then if at the end of the year you thought that it would be at 98 dollars if you waited another year that is what you would do even if you needed it.
We know that this is ridiculous yet every economist is making that assertion with a straight face.
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