U.S. Economy: Is The Weak Data A Prelude To An Actual Contraction?

All of the coverage that I am hearing on the news about the economic numbers coming in weak is all, "the glass is half full." People are saying, "oh, well, the numbers are lower than we expected but the economy is still growing. Yes, it is growing a bit more slowly than we thought but it is still growing."

Well, if we are going to go from growth to contraction, we have to slow down first. Yet everybody is assuming that these trends that are now entrenched are not going to continue. If you see a sharp decelaration in growth, how do you think it is not a prelude to an actual contraction?

Related exchange trade funds: Select Sector Financial Select Sector SPDR ETF (XLF), SPDR S&P 500 Index ETF (SPY), Nasdaq 100 Index ETF (QQQ)

Peter Schiff is an American businessman, investment broker and financial commentator. Schiff is the CEO and chief global strategist of Euro Pacific Capital Inc.

U.S. Economy: More Bad Data

Related topics: U.S. Economy Outlook, ISM Manufacturing Index;

Related exchange traded funds: SPDR S&P 500 Index ETF (SPY), Nasdaq 100 Index ETF (QQQ)

Peter Schiff is an American businessman, investment broker and financial commentator. Schiff is the CEO and chief global strategist of Euro Pacific Capital Inc.

Why The Fed Can`t Raise Interest Rates

The only way that we can avoid the inevitable is to keep creating inflation and to continue to blow air into the asset bubbles that undermine real economic growth. So, right now the Federal Reserve is unwinding QE3 and they are pretending that they are going to raise interest rates. But they actually cannot do that because of the enormity of the debt that we have. If interest rates actually went up, we would lack the ability to pay. We cannot service the debt at a normal rate of interest. The Federal Government cannot do that. And so, ultimately what is going to happen is the Fed will end up doing QE4, rather than raising interest rates, they are going to do more stimulus.

Related exchange traded funds: SPDR Dow Jones Industrial Average ETF (DIA), SPDR S&P 500 Index ETF (SPY), SPDR Gold Trust ETF (GLD)

Peter Schiff is an American businessman, investment broker and financial commentator. Schiff is the CEO and chief global strategist of Euro Pacific Capital Inc.