Last night, on the Daily Show with Jon Stewart, Peter Schiff was interviewed. Schiff is an “economic commentator” (as compared to an economist?) and the head of a brokerage firm. Stewart showed a number of clips of Schiff on CNBC prior to the current economic crisis warning of the dangers of the housing bubble, sub-prime mortgages, and over-leveraged companies and individuals. These comments were made well in advance of the actual recognition of the situation and there is audio of people actually laughing while he is talking (I got the impression they were other guests of panel shows, not the moderators or CNBC folks themselves, but I cannot be sure).
At any rate, the gist of Schiff’s argument is that
- The government should have let companies fail. No company is too big to fail.
- The market will dictate how things will fall out in the end, even if it means massive recession for now. The market is strong.
- This is all because of how messed up things were, so let’s let the bad die out
- The government is just making things worse by intervening, and we might have hyperinflation.
In some ways, I find this very dangerous. In others, thought-provoking.