A good article from Time discussing the rise of Peter Schiff, one of the doomsayers who called our current mess. The piece also discusses how Schiff’s media appearances have dropped 75% since the market collapse despite his prescient calls.
Schiff feels it is due to the media not wanting to hear any pessimistic viewpoints. With the markets rising from their lows, people want to think the worst is over. And, many of the Wall Street pundits have declared the end of the markets. Most players, including Nouriel Roubini, thinks we won’t break through the March lows.
I still think we are in for a bumpy road. I can’t say if we will break the March lows, but I wouldn’t be surprised if we did. While the free-fall has stopped, the economy has great headwinds that will take quite some time to fix. What amazes me is how so many people assume we are through this mess even though the solution to fixing this mess was nothing more than a repeat of the actions that caused the problem. The Fed has dropped rates to zero percent. The government increased its deficit spending considerably. The reason we are in this mess is due to an overinflated money supply which led to too much debt.
This is akin to giving a drug addict a fix. It may ease the pain, but it doesn’t heal the addiction. While I think the markets will test or break through the lows, it could be a couple years before it happens. Or, it could be a couple months. No one can time the markets.