It’s been fun over the past few years watching EuroPacfic Capital’s Peter Schiff educate mainstream (i.e. clueless) economists and money managers on CNBC and elsewhere. My personal favorite is this one from 2006, in which Schiff gets everything right and a pathetic little economist named Arthur Laffer makes a complete fool of himself. A couple of other good ones are here and here. And many more available on YouTube. This guy’s running a one-man seminar on realistic economic analysis.
One of the tricky things about writing an investment book is that six or so months elapse between writing and publishing, and a lot can happen in that much time. In this book’s case, the six months in question were among the most eventful in history, so some of what’s here is a bit dated. The early chapters explain why we’re headed for an epic crisis, much of which came to pass before the book hit the stores (there’s such a thing as being too right in this business). There’s also a discussion of surging commodity prices and the plunging dollar, which were true six months ago but not now. This makes the early chapters less relevant, but helps the book in a far more important way by making its advice–get out of dollar-denominated assets and into foreign equities while preparing for currency crisis–more actionable. At the beginning of 2008 these were, in retrospect, bad moves. Now they look pretty good.
Some of Schiff’s other points are valid and becoming more so every day:
- The U.S. government is lying to us about everything from inflation to debt to unemployment, so trust nothing you hear from Washington.
- Owning assets denominated in a declining currency is a recipe for disaster, so get as far away from U.S. bonds as possible.
- Gold and silver are good ways to preserve wealth in a currency crisis.
Towards the end, Schiff departs from the typical investment book format and offers some employment advice, going through the major U.S. industries one by one and discussing their futures. In a nutshell, with the world no longer interested in soaking up our ever-less-valuable paper dollars, we’ll have have to rebuild our domestic manufacturing capabilities, producing jobs in sectors where they’ve been disappearing. Schiff also offers some lifestyle tips for a suddenly frugal world, including when and if it’s advisable to borrow against one’s home and whether emigration to countries with better economies is a good idea. For more, here’s the Amazon link.