On Tuesday the Commerce Department released a fantastic estimate: In the third quarter of 2014, U.S. GDP grew at a rate of 5 percent, the fastest it’s grown since 2003.
But things might not be all they’re cracked up to be.
“Overall the economy is quite weak,” Peter Schiff, CEO and chief global strategist at Euro Pacific Capital Inc., told TheBlaze this week.
The fact that the Federal Reserve has kept interest rates near zero, where they’ve been since the onset of the recession in 2007-08, speaks volumes about what the nation’s financial leadership really thinks about the economy’s strength, Schiff said.
“If this economy really is so strong, why haven’t they raised rates?” Schiff questioned. “Why do they have to be patient? What are they afraid of?”
He said that the third quarter GDP figures, “however the stats are doctored up,” belie the true fragility of the U.S. economy — and its dependence on the Federal Reserve’s largesse.
Quantitative easing has artificially stimulated the economy for the past four years, and $3 trillion later the bond-buying program was ended with inconclusive results.
“Next year might be a recession without [more quantitative easing],” Schiff said.
It’s a recession that needs to happen, in Schiff’s view.