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2008 Financial Crisis

As Biden Drains The SPR Down To 1984 Levels, Chinese State Media Claims US Dollar ‘Is Once Again The World’s Problem’

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As Biden Drains The SPR Down To 1984 Levels, Chinese State Media Claims US Dollar ‘Is Once Again The World’s Problem’

Two days ago, U.S. president Joe Biden was criticized for claiming inflation in America hasn’t increased during the past few months. “I’m telling the American people that we’re going to get control of inflation,” Biden stressed during his “60 Minutes” interview that aired on Sunday night. Amid Biden’s claims, ahead of the next Federal Reserve meeting on Wednesday, the U.S. Dollar Index (DXY) crept up to the 110.776 region. Meanwhile, a recent report published by CCP-backed Global Times is pressing for de-dollarization as the U.S. dollar’s rise “might be the beginning of another nightmare” for “many countries in the world.”

Biden Highlights That US Gas Prices Are Back to March Levels After His Administration Drained the US Strategic Petroleum Reserve by 190 Million Barrels

Inflation has been awful in the United States but U.S. president Joe Biden has told the American people it will be tamed. His commentary during a “60 Minutes” interview was aired a few days before the Federal Reserve meets to hike the benchmark interest rate by 75 or 100 basis points (bps).

“The U.S. may begin refilling its emergency oil reserve when crude prices dip below $80 a barrel, according to people familiar with the matter,” Bloomberg’s Jennifer Jacobs, Saleha Mohsin, and Annmarie Hordern report.

Biden took a lot of flak from economists and market strategists after he noted that he believes the country’s inflation rate hasn’t spiked for months. Furthermore, the U.S. president has been taking pride in the fact that America’s gas prices have dipped.

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“Folks, gas prices are now back to levels they were at in early March,” Biden tweeted on Tuesday. “That means nearly all of the increases since the beginning of Russia’s war in Ukraine have been wiped out.”

However, the Biden administration hasn’t really explained why gas prices have dropped amid the Ukraine-Russia war and the highest inflation in 40 years. The U.S. president has failed to mention that petroleum prices in the U.S. have dropped because he’s been tapping into the U.S. Strategic Petroleum Reserve (SPR). While Biden mentions gas prices are back to levels they were at in early March, he forgets to mention that the administration started draining the SPR on March 31, 2022.

In fact, the SPR is at its “lowest level since 1984,” according to various reports published nationwide. The Ukraine-Russia war is still ongoing and Europe is still dealing with a significant energy crisis. While Biden has complained about carbon emissions the SPR has shrunk from 640 million barrels of oil to 450 million barrels. Furthermore, despite the U.S. funneling billions to Ukraine, Russian president Vladimir Putin detailed this week that he is not backing down, vowing to use “all means available” to win.

While DXY Creeps Higher, CCP-Backed Editorial Claims US Bureaucrats Have Committed ‘Financial Looting’ and a Strong Dollar Is a ‘Nightmare’ for Other Nations

Moreover, a CCP-backed Global Times opinion editorial is urging foreign nations to lean toward de-dollarization as the rising dollar may become “the beginning of another nightmare.” The editorial was published the day before the U.S. Federal Reserve meets to raise the federal funds rate. “A super strong U.S. dollar and the fall of other currencies will, to a certain extent, ease the scorching inflation in the U.S. economy, but the world will have to pay for it,” the Global Times says.

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Since the end of World War II and the start of the Bretton Woods agreement, the Global Times opinion piece author claims U.S. bureaucrats have committed “financial looting” and have exported crises to foreign nations. After the U.S. Dollar Index (DXY) dropped for three consecutive days, the DXY has risen on Wednesday to 110.776 ahead of the Fed’s meeting.

The DXY is a gauge against six major fiat currencies and during the past few months, the greenback has been stronger than ever. The Global Times editorial says America’s problems will not be solved by the Fed and Washington because these entities are not willing to see the “root cause.”

“If people dig the root cause, this is an inevitable consequence of U.S.’ blind and unlimited money printing to temporarily maintain ‘prosperity,’” the opinion editorial notes. “In other words, in the face of the deep-seated problems exposed by the 2008 financial crisis, Washington has been powerless, and unwilling as well, to solve them.” The author adds:

While the political elites in Washington boast of the ‘myth of the American system’ and take credit for ‘alleviating the crisis,’ thousands of poor families around the world are being trampled by them.

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2008 Financial Crisis, 450 million barrels, Biden Administration, CCP-backed, China, DXY, economics, Economy, Energy crisis, Gas Reserves, Global Times, Greenback, inflation, Joe Biden, Money Printing, Russia, Russian president, SPR, U.S. bureaucrats, U.S. Dollar Index (DXY), Ukraine-Russia war, US, US Dollar, US economy, Vladimir Putin, Washington

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What do you think about Biden’s claim regarding gas prices in the U.S. while he depletes the SPR? What do you think about the editorial published by Chinese state media that argues a strong dollar will be a nightmare for foreign nations? Let us know your thoughts about this subject in the comments section below.

Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits: Shutterstock, Pixabay, Wiki Commons, Bloomberg, Tradingview DXY

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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2008

Peter Schiff Warns US Faces A ‘Massive Financial Crisis,’ Economist Expects Much Larger Problems Than 2008 ‘When The Defaults Start’

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Peter Schiff Warns US Faces A ‘Massive Financial Crisis,’ Economist Expects Much Larger Problems Than 2008 ‘When The Defaults Start’

The economist and gold bug Peter Schiff usually has a lot to say, and this past week Schiff explained during an interview that he believes the U.S. will face a financial crisis worse than 2008’s ‘Great Recession.’ Schiff explains that the U.S. has a lot more debt than it did back then, and insists America’s economic downturn “is going to be a much bigger crisis when the defaults start.”

Chief Market Strategist at Euro Pacific Asset Management Says the Decline in US Inflation ‘Is Only Temporary’

While Peter Schiff detailed that he would liquidate his Euro Pacific Bank, the economist sat down to discuss the American economy with the anchor and producer at Kitco News, David Lin. The day before he spoke with Lin, Schiff explained that even though inflation is seemingly cooling, he believes the trend will not last. “Paradoxically investors are selling dollars and buying gold on a lower than expected rise in July CPI, as they think the Fed will adopt a less aggressive policy,” Schiff said on Twitter. “They’re right to sell dollars and buy gold, but for the wrong reasons. The decline in inflation is only temporary.”

U.S. productivity fell 4.6% in Q2 following a 7.4% fall in Q1. YoY productivity fell 2.5%, the largest drop since the series started in 1948. With falling productivity real wages must fall and consumer prices must rise. Government created #inflation is making both problems worse.

— Peter Schiff (@PeterSchiff) August 9, 2022

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While speaking on the Kitco News broadcast, Schiff further explained in greater detail why he thinks America’s economic downturn will be more ugly than 2008’s economic decline. Schiff says if the Federal Reserve keeps raising interest rates, then a financial crisis is inevitable. “2008 was about bad debt,” the gold bug and economist stressed. “It was about people borrowing money and they couldn’t pay it back. The collateral for the loans was no good because it was real estate, and prices went down. Well, we have much more debt now than we had in 2008 … And so this is going to be a much bigger crisis when the defaults start.”

This time around, however, America’s financial giants won’t get bailed out, Schiff noted. The economist remarked:

When they fail, it’s going to be a lot worse, except with inflation too high and the Fed fighting inflation. There’s no TARP 2.0. All these banks are going to have to be allowed to fail.

Schiff Says US Inflation Is ‘Going to Be Here for Years and Years, and Probably the Remainder of This Decade’

Schiff’s comments follow the U.S. Bureau of Labor Statistics July Consumer Price Index (CPI) report, which reflected a year-over-year increase of 8.5%. Following the CPI report, U.S. president Joe Biden was criticized a great deal when he said the American economy had zero percent inflation in July. Biden’s commentary followed the U.S. government attempting to redefine the technical definition of the word “recession.” “If you believe the official CPI, then prices, that are already very high, did not get any higher during the month of July,” Schiff told the Kitco show host. Schiff added:

I don’t think that’s something to celebrate… It’s not like consumers actually got the relief of prices coming down. There’s no doubt in my mind that we will get a higher number than 9.1 percent. We are nowhere near done with this inflation problem. It is going to be here for years and years, and probably the remainder of this decade and then some.

Schiff’s commentary about the official CPI numbers follows the post published on schiffgold.com the same day, which claims the Bureau of Labor Statistics’ CPI calculation uses a government formula that understates the actual rise in prices. Additionally, statistics from shadowstats.com’s alternative inflation charts show inflation is much higher than official reports.

Even multiple jobs don’t allow workers to keep pace with #inflation. June consumer credit surged by a much higher than expected $40.1 billion, while credit card debt soared at an annualized rate of 16%, as consumer went deeper into debt to afford to buy higher priced necessities.

— Peter Schiff (@PeterSchiff) August 5, 2022

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Metrics from the Truflation Index also indicate a much higher inflation rate than the CPI, with August 14 data at 9.41%. During Schiff’s interview with Lin, the economist said he expects a “massive financial crisis” and major issues with the U.S. dollar. When the dollar fails, he expects gold and silver values to skyrocket.

“The dollar has risen so far, in the early stages of this big inflation, because investors are delusional about the Fed’s ability to contain inflation and bring it back down to 2 percent,” Schiff concluded. “When they wake up to reality, that inflation is going to be way above 2 percent indefinitely, then the dollar is going to fall through the floor, and then gold and silver will go through the roof.”

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2008, 2008 Financial Crisis, 8.5%, 9.1 percent, 9.1%, consumer price index, CPI, Depression, Economist, Euro Pacific Asset Management, Euro Pacific Bank, Financial Crisis, Forecasts, gold, Gold Bug, Great Recession, Joe Biden, macroeconomic data, Peter Schiff, Predictions, Recession, shadowstats.com, silver, Truflation Index, US Bureau of Labor Statistics, US economy, US government, US Inflation, US President, White house

What do you think about Peter Schiff’s opinions and economic forecasts? Do you think Schiff’s predictions are correct or do you think he will be wrong? Let us know what you think about this subject in the comments section below.

Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,700 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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2008 Financial Crisis

Peter Schiff Warns Economic Downturn In The US ‘Will Be Much Worse Than The Great Recession’

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Peter Schiff Warns Economic Downturn In The US ‘Will Be Much Worse Than The Great Recession’

Following the Federal Reserve’s rate hike on Wednesday, economist Peter Schiff has had a lot to say since the U.S. central bank raised the benchmark rate by half a percentage point. Schiff further believes we are in a recession and says “it will be much worse than the Great Recession that followed the 2008 Financial Crisis.”

Peter Schiff Says ‘Fed Cant Win a Fight Against Inflation Without Causing a Recession’

While many analysts were shocked by the U.S. Federal Reserve’s move, since it was the largest rate hike since 2000, a report by schiffgold.com says the increase was hardly “aggressive,” and akin to a “weak swing that looks more like shadow boxing.” Moreover, the report explains Powell’s commentary this week contained some “subtle changes,” which suggest there might be “some economic turbulence on the horizon.”

Peter Schiff doesn’t think the Fed can beat the current inflationary pressure America is dealing with today. “Not only can’t the Fed win a fight against inflation without causing a recession, it can’t do so without causing a far worse financial crisis than the one we had in 2008,” Schiff explained on Thursday. “Worse still, a war against inflation can’t be won if there are any bailouts or stimulus to ease the pain,” the economist added.

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I remember how strong #StockMarket pundits and economists thought the U.S. economy was right before the 2008 Financial Crisis, even though we were already in The Great Recession at the time. It wasn’t strong, it was a bubble about to pop. Today’s economy is an even bigger bubble!

— Peter Schiff (@PeterSchiff) May 5, 2022

Schiff’s comments come the day after the Fed increased the federal funds rate to 3/4 to 1 percent. Following the rate increase, the stock market jumped a great deal, fully recovering from the prior day’s losses. Then on Thursday, equity markets shuddered, and the Dow Jones Industrial Average had its worst day since 2000. All the major stock indexes suffered on Thursday and cryptocurrency markets saw similar declines.

“If you think the stock market is weak now imagine what will happen when investors finally realize what lies ahead,” Schiff tweeted on Thursday afternoon. “There are only two possibilities. The Fed does what it takes to fight inflation, causing a far worse financial crisis than 2008 or the Fed lets inflation run away.” Schiff continued:

The Fed created the 2008 financial crisis by keeping interest rates too low. Then it swept its mess under a rug of inflation. Now that the inflation chickens it released are coming home to roost, it must create an even greater financial crisis to clean up an even bigger mess.

Schiff Criticizes Paul Krugman, Fed Tapering Includes Monthly Caps

Schiff is not the only one that believes inflation can’t be tamed, as many economists and analysts share the same view. The author of the best-selling book Rich Dad Poor Dad, Robert Kiyosaki, recently said hyperinflation and depression are here. The well-known hedge fund manager Michael Burry tweeted in April that the “Fed has no intention of fighting inflation.” While criticizing the U.S. central bank, Schiff also railed against the American economist and public intellectual, Paul Krugman.

“Back in 2009, [Paul Krugman] foolishly claimed that QE wouldn’t create inflation,” Schiff said. “Setting aside that QE is inflation, Krugman prematurely took credit for being right as he didn’t understand the lag between inflation and rising consumer prices. The CPI is about to explode higher.” Moreover, schiffgold.com author Michael Maharrey scoffed at the Fed’s recent tapering announcement as well. Maharrey further detailed how the Fed plans to reduce the Federal Reserve’s securities holdings over time.

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“As far as the nuts and bolts of balance sheet reduction go,” Maharrey said, “the central bank will allow up to $30 billion in U.S. Treasuries and $17.5 billion in mortgage-backed securities to roll off the balance sheet in June, July, and August. That totals $45 billion per month. In September, the Fed plans to increase the pace to $95 billion per month, with the balance sheet shedding $60 billion in Treasuries and $35 billion in mortgage-backed securities.”

Tags in this story

2008 Financial Crisis, Central Banks, Crypto, dow jones, Economic Downturn, Fed, Fed Chair, Fed Tapering, Federal Reserve, gold, Great Recession, inflation, Inflationary pressure, jerome powell, MBS, Monetary Supply, Paul Krugman, Peter Schiff, QE, Rate Hike, Schiff, Schiffgold, stocks, US Central Bank, US economy, us treasuries, Wall Street

What do you think about the recent commentary from Peter Schiff concerning the Fed fighting inflation and the rate hike? Let us know what you think about this subject in the comments section below.

Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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