Peter schiff, a man who long predicted the 2008 housing bubble and recession back in 2006. Although part of this is just luck that he was right (as many other people are always sounding alarm bells about various things), he hit a lot of true points.
He said that it would start in 2007/2008 and it is due to “too much consumption and borrowing” and not enough savings and we have to rebuild that at some point. Other people on the show say that everything is fine and we great policies in place. Schiff says that when the real-estate and stock market go down, that “paper” wealth will go away. The housing bubble is due to speculative buying and bad lending regulation (i.e., low adjustable rate mortgages) according to Schiff. All of the profits are based on speculation, like the dot-com bubble. He says this will effect everyone, not just those with bad credit.
It is also interesting to note that fox news makes fun of him by saying he is crazy or boring and his critics say they dont know what he is talking about and that “the worst is over” and the banks have plenty of measures they can take to heed a recession or that the measures in place will work through the economy and that the stock market is fine .
Finally he says that the government needs to cut spending not taxes because that passes the inflation onto the consumer, who has more money but goods and services also cost more. He also is a fan of buying gold….If I had a time machine i would invest in yahoo in 1998, houses in 2004 and gold in 2006, but bubbles always burst and you never know when the ride is about to end.