Schiff on Kitco News: The Fed Will Print More  

Last week, Peter joined Kitco News to take stock of the Federal Reserve’s stealth return to quantitative easing and what it means for inflation, the dollar, and precious metals. He walks through why short-term Treasury purchases are no different in effect from longer-term QE, why the Fed will likely have to expand its interventions, and why that reinforces his long-standing bullish case for gold and silver miners. He also touches on tokenized gold versus Bitcoin and warns that extreme dollar weakness could prompt capital controls.

He opens by explaining why buying short-term Treasuries is effectively the same thing as classic QE (quantitative easing), meaning money printing and debt monetization, and why that will likely expand soon:

But the fact that they’re buying short term securities rather than long term, which is what they were doing when it was an official QE program, is really a distinction without a difference. The bottom line is they’re going to be printing money, expanding their balance sheet, you know, by buying U.S. government debt instruments. So that’s, I mean, that’s inflation. That’s debt monetization. But I agree that ultimately, and not even that far, I’m sure sometime next year, maybe even the first half of next year, they’re going to end up expanding that to more than $40 billion. And they’re going to extend the maturities on what they’re buying.

He notes the Fed is trying to push down interest rates by soaking up Treasuries because private buyers aren’t stepping up — and that short-term purchases are really a sign of weak demand for government debt, not prudence: