Ambiguous Fed Statement Means Headaches for Yellen

Peter Schiff has shared his thoughts on the Federal Reserve’s decision to begin tapering QE in January. While the Fed’s official statement suggests the economy is improving, it also gives plenty of room for stimulus to be ramped back up in the future. Fortunately, physical precious metals will likely remain at bargain prices until the market realizes that a real exit from QE is impossible.

“There can be little doubt that today’s Fed announcement is an epic attempt at rhetorical audacity. The message they hope to convey is that they are tightening monetary policy by loosening it. Based on the early market reactions, the trick has seemed to work.

I believe the Fed was forced into this exercise in rabbit pulling because it understands far better than the cheerleaders on Wall Street that the economy, despite the soaring gains in stocks and real estate, remains dependent on continued stimulus. In my opinion the seemingly positive economic signs of the past few months are simply the statistical signature of the QE itself. There is little evidence to suggest that the trends are self-sustainable. But seemingly strong data had made the arguments in favor of continued QE increasingly untenable. As they could no longer stay the course the Fed had to do something. Ultimately they decided to play it both ways.”

Read the Full Commentary Here

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