In the video below Peter Schiff is fairly upset at the USD. According to him the Dollar rally we have experienced is borderline delusional, with most traders making a giant mistake. As you know, Mr. Schiff expects massive inflation and a dollar collapse going forward,.
Once again, we believe he is dead wrong on both counts. Here is why…..
The US Dollar bottomed exactly where it should have a few weeks ago. We were actually expecting DXY to hit $88, but it reversed a bit earlier. At $88.43 to be exact. In addition to the Dollar being extremely oversold at that juncture, completing its leg down, here is why Mr.Schiff is wrong.
We are on a verge of a massive deflationary cycle (not inflation or hyperinflation) In fact, we are already deep in this cycle. The FED efforts or flooding the market with cheap money has hidden the problem, but only for the time being. That is why we are not seeing massive inflation or wage inflation outside of delusional inflation in risk asset prices.
A deflationary collapse is in our future. When it strikes you will see the USD surge while inflation disappears into thin air, to be replaced by a deflationary death spiral. Too much debt assures us that no other outcome is possible.
