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You might be thinking everything’s okay: the stock market is on the rise, jobs are growing, the worst of it is over.
You’d be wrong.
In The Real Crash, New York Times bestselling author Peter D. Schiff argues that America is enjoying a government-inflated bubble, one that reality will explode . . . with disastrous consequences for the economy and for each of us. Schiff demonstrates how the infusion of billions of dollars of stimulus money has ...
You might be thinking everything’s okay: the stock market is on the rise, jobs are growing, the worst of it is over.
You’d be wrong.
In The Real Crash, New York Times bestselling author Peter D. Schiff argues that America is enjoying a government-inflated bubble, one that reality will explode . . . with disastrous consequences for the economy and for each of us. Schiff demonstrates how the infusion of billions of dollars of stimulus money has only dug a deeper hole: the United States government simply spends too much and does not collect enough money to pay its debts, and in the end, Americans from all walks of life will face a crushing consequence.
We’re in hock to China, we can’t afford the homes we own, and the entire premise of our currency---backed by the full faith and credit of the United States---is false. Our system is broken, Schiff says, and there are only two paths forward. The one we’re on now leads to a currency and sovereign debt crisis that will utterly destroy our economy and impoverish the vast majority of our citizens.
However, if we change course, the road ahead will be a bit rockier at first, but the final destination will be far more appealing. If we want to avoid complete collapse, we must drastically reduce government spending---eliminate entire agencies, end costly foreign military escapades and focus only on national defense---and stop student loan or mortgage interest deductions, as well as drug wars and bank-and-business bailouts. We must also do what no politician or pundit has proposed: America should declare bankruptcy, restructure its debts, and reform our system from the ground up.
Persuasively argued and provocative, The Real Crash explains how we got into this mess, how we might get out of it, and what happens if we don’t. And, with wisdom born from having predicted the Crash of 2008, Peter Schiff explains how to protect yourself, your family, your money, and your country against what he predicts.
"Peter Schiff's new book "The Real Crash; America's Coming Bankruptcy" is written in the same blunt and punchy style that makes him a favorite guest on my Fox News show. It's not just what he says, but the fact that he lives what he says. Unlike Some authors who talk about business as spectators, Peter doesn't speak from the ivory tower of academia or from the comfort of an anchor chair. He runs a real business and fights every day to make it a success in spite of all the government's tax and regulatory policies."— Mike Huckabee; Host of The Huckabee Show and former Arkansas Governor and Presidential Candidate
"America's political leaders should have taken Peter's 2007 book, Crash Proof, to heart before they tried to borrow, print and bail us out of trouble. Today, they — along with all Americans — absolutely must take heed of The Real Crash. Peter Schiff understands the marketplace, and he understands the consequences that occur when government attempts to manage that marketplace. Pay attention, America!”— Gary Johnson, Former governor of New Mexico and presidential candidate
“In ‘The Real Crash,’ the fearless Peter Schiff has written the most compelling argument against central economic planning and debt-financed consumption to come along since our present woes were exacerbated in 2008. His explanations of how unfettered free choices will produce prosperity, and how ending the Federal Reserve, abolishing the IRS, and returning to the gold standard will tame the federal beast are among the most forceful and cogent I have seen. He even explains how anyone can prosper from government stupidity in these perilous times. And he does all this in a breezy and readable format.”— Judge Andrew P. Napolitano, Senior Judicial Analyst, Fox News
“Peter Schiff is an original thinker, a man of startling insight and honesty, in many ways, a genius. I have learned that you disagree with him at your peril. He is one of the few men of finance of whom I wish I could say I had paid more attention to. Live and learn. Read and learn.”— Ben Stein; author, actor, political and economic commentator
"Peter Schiff says the Fed's bubble machine is destroying the American economy and he is right. Zero interest rates and QE are crushing savers, rewarding speculators and enabling the Washington politicians to issue endless debt. Every concerned citizen should read this."— David Stockman; Former OMB director under President Ronald Reagan
“Peter Schiff has been painfully right about the downward spiral of the U.S. economy over the last four years. Easy money, rising tax rates, and unbridled debt are a prescription for economic disaster. Let's hope Barack Obama reads this.”— Stephen Moore, Economist and Fox News commentator
“While many of us have justifiably focused on how high taxes are economically corrosive, Peter Schiff does a great job of explaining why government spending and debt are even worse. As we continue grappling with the monster of a runaway federal government, this book is one of the best assets conservatives can turn to in making the case for fiscal responsibility and capitalism.” — Grover Glenn Norquist; President of Americans for Tax Reform
“Peter Schiff was one of the few pundits who predicted correctly the 2008 economic and financial collapse. Now, he makes a compelling case in a highly readable book that the day will come when the world stops trusting the dollar and the ability of the US government to pay its debts. I agree with him that “Then we’ll get the real crash.”— Marc Faber; Editor, The Gloom Boom & Doom Report
“You need to know his case whether he is right or not if you are going to be prepared for this decade.”— Jim Rogers; Investor and Bestselling Author of “A Gift to My Children” and “Investment Biker”
Copyright © 2012, 2014 by Peter D
Part I The Problem
1 Where We Are and Where We Are Headed 7
2 How We Got Here: Government Is the Problem 28
Part II The Solutions
3 Jobs, Jobs, Jobs: Government Can Improve Employment Only by Getting Out of the Way 55
4 How to Fix the Financial Industry: Deregulate 76
5 Sound Money: Return to the Gold Standard 106
6 Tax Reform: For Starters, End the Income Tax 126
7 Tear up the "Third Rails": End Social Security and Medicare 153
8 Fixing Higher Ed: Time to Drop out of College? 179
9 Health Care: Repealing ObamaCare Is Just the Beginning 205
10 Putting Government in Its Place 227
11 America Is Bankrupt: Time to Admit It 259
12 Investing for the Crash 276
Appendix I Letter to Investors 309
Appendix II A Brief History of Money in America 313
Posted May 27, 2012
Since the housing and financial crash of 2008 America's recovery has been tepid at best. Unemployment has remained high; manufacturing has not returned; personal savings are as low as they've ever been, and personal debt as high; housing is still a mess, and banking not much better; and, on top of it all, government debt is awe-inspiring and seems completely insoluble. According to financial investor, commentator and author Peter Schiff, while all of this is certainly disheartening it should not come as much of a surprise. Indeed, Schiff argues that all of this economic slumping is a natural result of America's misguided economic policies; including especially the Federal Reserve's manipulation of interest rates, the government's uncontrollable borrowing, and, in connection with this, the maintaining (and even expansion) of unsustainable social programs . For Schiff, these same policies led directly to the crash of '08 (which he correctly and very famously predicted), and are leading the U.S. directly into an even worse crash now. In his new book `The Real Crash: America's Coming Bankruptcy--How to Save Yourself and Your Country' Schiff outlines how America got itself into this mess in the first place, what the end game is likely to be, and what we should do to make the coming unpleasantness the least unpleasant as possible.
The main problem--and where most of the other problems begin--according to Schiff, is the Fed's manipulation of interest rates. By interfering with the free market value of money, and making it cheaper than the market would dictate, the Fed encourages financial bubbles that then necessarily pop. When a bubble pops the market needs to correct itself; however, over the past 20 years, the Fed has not really allowed this correction to take place, as every time a bubble pops the Fed has lowered the interest rate even further, causing more money to enter the system and a new bubble to form. First it was dot-com stocks, then it was housing, and now it is government spending. For Schiff, though, the sheer size of the debt, and the fact that it is running away faster and faster everyday (and has no realistic chance of ever being repaid) will sooner or later turn investors away from considering the American dollar a valuable reserve--at which point it will lose its status as the world's reserve, and investors will stop investing in it.
At this point, the American government will have but two options. It can either declare bankruptcy, or it can print the money it needs to pay its debt,, thus causing hyper-inflation. In either case, an enormous crash will result.
At this point we will be forced to start over. For Schiff, this may not be such a bad thing, for, according to him, we have simply put ourselves in an unsustainable position, and the sooner we start over the better. At that time, Schiff argues, we can finally get back to the small government and free-market forces that America's founding fathers designed the country around. While much of the book is focused around how we can do this now, before the crash hits (in such areas as banking & finance, taxation, healthcare, education, the military, immigration and the war on drugs et. al.), you get the feeling that Schiff thinks that the crash is actually inevitable, and that these reforms will have to take place after The Real Crash.
A full executive-style summary of the book will be available at newbooksinbrief dot wordpress dot com on or before Monday, June 4.
9 out of 11 people found this review helpful.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted June 9, 2012
For those who aren't familiar with Schiff's understanding of the economy I refer you to 2 things: 1) Schiff's book Crashproof (written in 2006) or Crashproof 2.0 (a copy of Crashproof but with commentaries after each chapter about how things played out in 2008). He wasn't just a "doomer" in predicting the 2008 financial crash; he explained why.
Secondly, he was recognized for his analysis by an economist, Bezemer, who wrote a paper "No One Saw This Coming." About a dozen other people were also recognized (note no Krugman-type Keynesians understood, because their economics ideas don't allow for such realities).
If you read books/articles by all of the "predictors" of the 2008 crash, you will find that none of them think it has been resolved. The problems weren't about a few regulations; they are about inherently spending more than what we produce. Their solutions, though, are all somewhat different.
Schiff understands we have to get back to the norm: we as a society have to live on less than what we make to recover. How to do this as a "gentle landing" or "peel off the bandaid" is the source for debate. His ideas are thoughtful and most probably realistic in the economic sense. Unfortunately, I doubt they are politically palatable because politicians won't admit the trouble we are in until it is too late. So while I agree with his message, I look at the book primarily for how I might handle things as an individual.
The only thing I question when reading his book is his outlook on China. It is more positive than I hear from other analysts, and I don't know if anyone can be certain about the data coming from China. It seems to me a lot of his predictions (particularly inflation) would change if China is not as strong as he thinks. Therefore, my main criticism of the book is that I would like to see him discuss how things would work out "differently" if China isn't as healthy as he thinks it is.
In short, I think this is an important book in understanding the economy and trying to decide where to place your own investments and protect yourself.
7 out of 7 people found this review helpful.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted June 4, 2012
If the wealth of america can be summarized as the wealth of all its citizens summed up and divided by the number of citizens, then the most patriotic thing you can do to maintain a strong america is maintaining a strong, collaborative, honest you. Protecting your wealth, and engaging in fair trade with others is what we all need to be doing. Forget what the government says is right for you, and forget what the government says is right for your country. I dont need to go into all the details of why the government right now cannot be trusted. If you want to keep trusting your own government, thats noble of you and good luck with that. I will continue to parse each statement from the government as standalone as if it came from anyone else.
This book is great, Peter will be proven right again, and given that this book is selling well, hopefully there will be enough people left after the depression to get jobs and real economic growth again.
Also, usually a one star rating = no read.
6 out of 6 people found this review helpful.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted May 22, 2012
THIS BOOK IS AMAZING!!! Peter Schiff CLEARLY breaks down what will happen if we continue down this economic road. He provides excellent solutions that anybody can execute at any level. Unlike all the banksters and and cable news channels, Schiff predicted the mortgage crisis when everybody called him crazy. Google 'Peter Schiff Was Right' and you will clearly see why Schiff is a genius!!!
6 out of 8 people found this review helpful.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted June 6, 2012
Yes, the recovery is artificial.
Yes, it is more than likely that we are headed as a country off a steeper cliff than we have ever experienced, but the author's suggestions to fix the situation are no better than what has already been done by Obama, Bush, Clinton, etc. Less regulation?? wasn't it less regulation in the form of repealing Glass-Steagall that helped get us into this mess in the first place? I don't understand how Mr. Schiff can expect the public to believe that less regulation, lower wages, and the elimination of the FDIC would somehow protect them from investment banks doing exactly the same things they have been through 2008 and today. Whether its part of a political platform, manifesto, or his version of the social contract, it appears that he is counting on the American public to willingly choose this road to recovery. That sounds like too hard a pill to swallow.
5 out of 11 people found this review helpful.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted April 3, 2014
First of all, I read the book 4 times during a flight from Japan to the States because of a business trip. Giving this book one star is way too much for what it was supposed to be worth. Peter Schiff (agree or disagree with his ideals) made excellent points on why the government is how it is and he also made exceptional proposals on how one can protect themselves in a personal standpoint and as a tax payer of the U.S. With that said, what was wrong with the book? Honestly, there were ABSOLUTELY not a single pop-up page where something exciting would jump out while I turn the page. There was also not a single page with fun illustrations to observe. There was not a "fun page" where one can solve puzzles and/or connect the dots to form some kind of cute animal. All in all, if you are looking for a book that does not contain fun pages to keep you interested, do not get this. one star.
2 out of 2 people found this review helpful.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted May 22, 2012
What a nut. This guy simply does not understand our financial system, he does not understand what it takes to exit a severe recession and restore growth,and he does not understand why the world continues to view the U.S. as the ultimate safe haven (seen the interest rates on our 10 and 30 year bonds). Declare bankruptcy as country? You've got to be kidding. That would indeed be catastrophic. Yes, we have too much debt. After Clinton era surpluses and economic growth, the GOP policies under Bush left us with huge deficits and a collapsing economy -- and it'll be a long climb out of that hole. But this guy's policies would just dig the hole much, much deeper.
2 out of 27 people found this review helpful.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted June 4, 2013
Sensationalist, simplistic, manipulative garbage. People seem to enjoy how easy Schiff is to understand. The reason he is easy to understand is that he doesn't present the full picture, which is complex. Best avoided.
1 out of 5 people found this review helpful.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted June 18, 2012