Source: Cambridge House – Epic debate featuring faceoff between Peter Schiff and John Mauldin
Honestly, I don’t think this is even near epic of a debate between Peter Schiff and John Mauldin. All of the speakers on the panel were talking some sense except John Mauldin who seems to be conjuring impractical scenarios and flip-flopping when challenged.
John Mauldin talked like he lived in a different world where the Fed can go crazy printing dollars and the value of the dollar will still be strong. Peter Schiff was right to point out his talk about how an oil revolution and some ‘credible deficit plan’ will get the US out of the debt hole it is in right now depends on many ‘IFs’.
“We (United States) will be by 2020… 2022 not only be importing oil, we will be shipping it out. We could have a positive trade surplus within ten years… twelve years. When we stop shipping dollars out and the world is still a dollar economy and it will be, the value of the dollar will become remarkably strong. And the Fed can print trillions of dollars, the dollar will still be strong. This is if we create a path to a credible deficit plan. And if we do that the dollar is going to be far stronger than any of us think. The Fed will be able to print more money than seems rational and we will actually get away with it… But we could see a very very strong dollar simply because of the really lucky thing that we’ve got lots of oil…”
Here is some notable takeaway from Rick Rule:
“You have to generate utility. You have to create more wealth than you spend. It’s pretty simple. That doesn’t seem to be invoked so much in the United States which is one of the reasons we have problems.”
“When your out-go exceeds your income, upkeep becomes your downfall. It’s pretty simple stuff… You lend money to people where their income exceeds their out-go.”
“When you have made some money, you have to find a way to keep it. And in the context of this conference, I think that means you have to be a contrarian. And you have to be an investor in value.“
Towards the end, Peter Schiff has the following to say about indebted countries having no intention to pay back what they owe:
“It’s not like we’re(United States) going to pay our debt back. It’s the same thing. Our government cannot pay our debts either. It’s all a question of how we default. Do we do it legitimately or do we inflate? But our creditors are not getting their money back. It’s not even in the realm of possibility.”
“We(United States) haven’t paid anybody back. It’s a Ponzi scheme. No one gets paid back. When we pay the people back, we’d borrow the money.”