Peter Schiff talks about the effects of Obama on economy

[jonquest]

Interest rates are controlled by the Fed, not by the government. We have no say whatsoever in what the Fed does. And, if they did cause this by making interest lates too low, it wouldn't be the first time they created a financial crisis.

I agree. We do not control the Fed, but Congress does have the power to get rid of the Fed. It was unconstitutional when they created it in the first place.

We let the free markets do what they want for most of 20 years. They don't regulate themselves. Greenspan, who shared the same idealistic philosophy as you do, admitted recently that he was wrong in deregulating the markets.

We have not had a free market the past 20 years. There have been regulations in place during this time. For example a piece of legislation that forced banks to give out loans to those who usually would not be able to get a loan was put into law in 1977 under the Carter administration. This caused many loans not to be paid back because they were given out to irresponsible people.

Banking interests own our government and have owned it since the establishment of the Federal Reserve. They've engineered their system so that they have us by the balls, and most people don't even care how bad the banks fuck us over. If Ron Paul HAD been elected, he would have been approached by these interests and either corrupted, or they would lobby against him in Congress.

Ron Paul has been in Congress for 20 years. He has been corrupted yet, and I don't think that would change if he became President. His whole economic stance is based in opposition to the central bankers.

The problems we're seeing now are systemic. Our system is designed to work in favor of banks (all money starts in a bank, and inevitably ends up in a bank). In that system, we can never be free of debt. Ever. And, as I said before, if we pay off our debts, we have no money supply.

I agree. This is why the system needs to be changed. It promotes debt and hurts savings. Also, the inflation is a tax on the middle class because their wages stay the same, but prices increase. We need a non-mass-inflationary currency.

If government doesn't interfere with the free markets, the government will fail. What else could it possibly do? Our military is already being marginalized by private security forces. Without government interference, the free markets will eventually take over as government, and that is not a particularly pleasant thought.

This isn't true. The military is being marginalized by private companies because George Bush is choosing to give them contracts. The free markets would take over the pricing of goods, but not the government. In many cases private institutions need to take over the public ones though. For example, the school system. Could you give an example of when a private company would take over a government institution and it would have a negative effect?

Oh, and one last thing, if the interest rates hadn't been so low, this crisis would have been a lot worse when it hit. Like I said, the system we live in operates on debt. Our money supply would have hit contraction by now if interest rates had been higher than they already were.

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The problem we are having is inflation of prices because of too much money being created. How can we solve the problem of inflation with more inflation? We need to let the market decide interest rates.