Peter Schiff on Oil Prices, Coming Recession

From NewsMax.

While falling oil prices are a good thing for the consumer sector, as they push gasoline prices lower, in the end they’re a bad thing for the economy, Peter Schiff, CEO of Euro Pacific Capital, told Newsmax TV.
“We can enjoy cheaper gasoline, but unfortunately it’s probably a harbinger of another recession,” he told “America’s Forum” on Newsmax TV.
Oil prices have plunged to a five-year low. “They’re falling because the markets are anticipating a big drop in demand, as the world economy goes into recession, and that includes the United States,” Schiff said.
“This is negative for oil, but it’s also negative for all the other markets. The stock market, the housing market, … the bond market, and it’s negative for the U.S. economy.”
He also sees the Fed resuming quantitative easing, after ending the third round last month.
“What’s going to be an even bigger negative is when the Federal Reserve comes back with their monetary guns blazing and they launch QE4,” Schiff said.
“Then the oil price is going to rise to an even higher level than it fell from and that’s going to be very bad for consumers who have to pay a lot more for oil and everything else.”
U.S. oil traded over $107 a barrel in June and stood at $55.93 Tuesday afternoon.
QE3 propped up financial markets across the board, Schiff said. “So now that the Fed is winding down QE and threatening to raise rates, a lot of the markets that were lifted on a sea of liquidity are coming down.”
As for oil, “the problem is a lot of money has been borrowed, predicated on the belief that oil would be $80 to $100 a barrel,” Schiff said. “So if those loans default then a lot of jobs get lost. That’s going to bring about a recession.”
A huge energy industry has recently been built in the United States tied to that oil price, he said. “So the whole industry would be dismantled, and that alone would be much more disruptive than let’s say the bursting of the dot.com bubble.”
But the real crisis will be a weak dollar in the long run, Schiff said. “Right now people are worried about the ruble. That’s just the warmup,” he said. “The main event is going to be the dollar crisis, and when our currency starts to collapse it’s going to be much more problematic”

The fluctuation of oil and gas prices usually affect the cost of food, but I’ve seen nothing in my local grocery store that indicates a drop in food prices along with what I pay at the pump.

High gas prices are also bolstered by asinine regulations and a myriad of other factors.

Obama and the Dems keep blocking efforts to drill for our own resources and the construction of the Keystone pipeline, while vilifying the petroleum companies as ”big, evil, greedy creatures destroying the planet”, and wasting billions of taxpayer dollars on his  eco scams.  But by gawd, the idiot will loan Brazil $2 Billion to drill their own.

Oppressive taxes and regulations, instability in the Middle East, the hostility of big government towards drilling for American oil, speculators who gamble on the futures markets to line their own pockets, and foot-dragging on the part of the bureaucracy to open the markets to feasible energy sources, has created a sewer of mismanagement and corruption that chokes the life out of the economy and our wallets.

I’m very glad that the gas prices are under $2.00 right now. Unfortunately, it won’t stay that way; it will go back up. In the meantime, we need to build the Keystone pipeline, start using our own resources, invest in alternative energy resources, and get that fucking OPEC monkey off our backs.

Now is a great time to start.

Related article:
http://economiccollapsenews.com/2014/12/17/peter-schiff-falling-oil-prices-a-signal-of-another-u-s-recession/