Peter Schiff warns about stagFlation for the US economy

Chief Economist of Euro Pacific Asset ManagemenCount Claman count”

Schiff’s comments to the show appeared shortly after the Federal Open Markets Committee (FOMC) completed the latest meeting in the afternoon, selecting to keep the central bank’s benchmark at the current level.

After that, the Federal Reserve Network Jerome Powell issued the media outlets about this decision.

The slate was told by the hosts Liz Klaman that “the biggest departure is that Powell confessed that they did not imagine what would happen.”

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“They don’t really know what will happen to consumer prices. They do not know what will happen with employment,” the slate claimed. “I don’t even think their forecasts are as desired.”

The federal funds rate ratio will remain on the current range from 4.25% to 4.5% after the final decision of the Fed.

Fomc policy also released short information about economic forecasts known as the so -called “point story”, which showed that participants expected two decrees of interest rate in 2025, and then one in 2026 and 2027.

They also design PCE inflation this year up to 3% before decreasing to 2.4% in 2026 and 2.1% next year. The real gross domestic product (GDP) is considered as a slowdown up to 1.4% in 2025, before the growth gained up to 1.6% next year and 1.8% in 2027. Unemployment is regarded as 4.5% in 2025 and 2026 before dropping to 4.4% in 2027.

The slate said he thinks the inflation would be “much higher” than expects the Fed and that US Economics It will be “much weaker”.

He recognized Federal “Bring their inflation a little” for the nearest and “forecast of their growth”, but added that such changes were not “big enough”.

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According to Schiff, the “big problem” for inflation is “all chickens for inflation that the Fed has been releasing for more than a decade is returning home to overcome” rather than the recent Trump administration tariffs for imports from foreign countries.

“We have a lot of dollars that are diminishing worldwide, thanks to many years of artificially low interest rates and quantitative softening, and more of these dollars are going to return home when foreigners leave the financial asset of the United States,” said Shiff Claman.

“You see a global outcome from US shares, the US, and all this money will return home by offering prices.”

The slate predicted that Stagflation “with a recession and much greater inflation at the same time in the United States will really complicate the defense ability to try something with any problem.”

Low interest rates will not help the US economy, it also claimed, marking them “the reason”.

“The decision provides much higher interest rates,” he said. “Now I understand that it will be very painful, given the economy we created, built on the foundation of cheap money.”

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“This means that stock prices are reduced, real estate prices are decreasing, companies do not get,” he added. “There will be bankruptcy. There will be default. There will be a protracted recession, probably a much worse financial crisis than in 2008, but everything that is to happen because the alternative is even worse.”

USA goes on the way to ‘Escape inflation“It can be” hyperinflation “, predicted the slate.

The last FOMC meeting was the fourth time when it gathered this year.

FOMC also decided not to change the rate at three previous meetings in January, March.

In late May, the personal consumption index showed 0.1% per month and 2.1% compared to last year for April.

Eric Revel contributed to this report.