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A great lecture about the financial crisis

My good friend in the US, Russell E. Whitaker, has plugged this excellent lecture in a Facebook posting (thanks Russell!). The lecture is delivered by the investor and commentator, Peter Schiff. It runs for one hour and 16 minutes, so you will want to find an appropriate time to brew up some coffee or pour your favourite tipple, relax and enjoy. He is an entertaining speaker, who makes the issues intelligible without dumbing down. He also has ideas on how to protect your money during the fallout.

It should be seen in conjunction with this book, by Thomas E. Woods, that I have mentioned a few times before. As these men observe, it is nonsense for policymakers like Gordon Brown, Alan Greenspan, etc, to blame what has happened on reckless private individuals, “greedy” Wall Street bankers, and so on. What happened was clearly predictable once one understands how incentives to save, borrow, invest and spend have been skewed by ultra-cheap central bank credit, the moral-hazard drivers of state regulations, bailouts, and the rest.

I rather liked Mr Schiff’s idea that Bernard Madoff, the Ponzi fraudster, is ideally qualified to run the US Treasury Department, given his er, skills.

Update: After queries, I put another link on as there appear to have been some problems with it the first time around.

10 comments to A great lecture about the financial crisis

  • Chris

    Link no worky. Seems to be logout of facebook page.

  • some random lurker

    I think this might be it:

    Gotta love Web 2.0!

  • James

    The other day I found an old ‘Motley Fool’ investment book amongst other old books. I noticed the publication date was 1998, so with the benefit of hindsight I was interested to see what they had viewed as good investments.

    Here’s their take on the (then) recent decision by central banks around the world to start selling gold reserves and buying US Treasuries: “If the world’s central bankers want to put their faith in them good ol’ boys in the US government rather than an off-yellow metal of indeterminate value, then we’d be fools to argue.”


  • Nick von Mises

    Schiff is a good speaker and nails much of what caused the crisis. However he’s gone very badly wrong on what happens next and people who invested with him in 2008 have been destroyed.

    See Mish: http://globaleconomicanalysis.blogspot.com/2009/01/peter-schiff-was-wrong.html

  • Brad

    If Schiff is wrong it seems that he is wrong because he did not anticipate that the Feds would engage in as much nationalization and quasi-nationalization that it has. As I have said many times once the crash occured, we as a society would have two directions to move in – toward a free market or toward a centralized Command Economy. I assume he bet/speculated that once the collapse occurred that we would necessarily have to move toward a free market. Instead we are seeing the endgame finalizing the corporo-fascistic State (and the same around the world).

    Wrong is wrong in the world of speculation, but it is depressing that he is wrong because we have chosen the road to ruin.

  • James

    I don’t think he was wrong. Investing is a long-term project; it makes no sense to take a snap-shot of his recommended stocks’ performances for a few months during the worst stock market meltdown of the last thirty-odd years and claim he’s wrong.

    Moreover, those who followed his advice and carried on buying his chosen stocks during the recent market slumps have been amply rewarded – far more than people who stuck to the boring ol’ US, British and European markets.

  • Paul Marks

    Dr Thomas Woods and his work “Meltdown” are indeed the best source of information on the current crises.

    Glenn Beck has gone for moderation by pushing Thomas Sowell and his work “The Housing Bubble: Boom and Bust” – and whilst that is a good work and it does keep the Chicago school people “on side” as it where from an economics point of view (as opposed to a political calculation point of view) we should not lose sight of the superiority of Thomas Wood’s examination.

    As for the political situation – it is terrible indeed.

    Some people are saying that Barack Obama is Clement Atlee of the United States – Atlee being the Labour Party Prime Minister who finally led Britain to a government dominated economy after World War II.

    However, things are even worse that this.

    Clement Atlee respected dissent and the press and so on attacked him head on. The schools and universities in the 1940’s were also fairly unpolitical in the 1940’s – as were the courts.

    In the United States the press (and the mainstream broadcast media) the schools the universities and (increasingly) the courts are hand maids of the “progressive” regime – and President Barack Obama fully supports this (and has been involved in this politization campaign all his life).

    Barack Obama is not the Clement Atlee of the United States. He is the Dr Harold Laski of the United States. What he is doing to United States society is what Laski would have done to Britain had not Atlee had not opposed Chairman Laski.

    Things really are that bad.

  • Relugus

    Wall Street is too incompetent to run itself.

    If America is a “free-market” economy, why do banks and arms manufacturers interfere in government?

    Why did Halliburton decide defence policy?

    Why are bankers even allowed into the US Treasury? Hank Paulson and Tim Geithner are bankers and thus cannot be trusted to run a government department due to conflict of interest.

    People in the private sector should not be allowed into government and vice versa.

  • Laird

    Regulus, who said that America is a free-market economy? At best it’s a mixed economy, rife with crony capitalism. It’s no different under Obama than under Bush; there’s just been a slight change in the favored few. The principal problem, however, is not the private sector interfering with government, but rather the reverse. Furthermore, if governmental power were restrained to its legitimate sphere there would be far less incentive for the private sector to “interfere” in it in the first place.

  • Paul Marks

    At the risk of “feeding the trolls” – no Halliburton did not decide defence policy.

    America a “free market” economy – Laird has replied to that, but I must add that Barack Obama (in four short months) has taken things far further in the direction of collectivsim than even Bushbrain did.

    “Wall Street can not run itself”.

    I.E. people can not be allowed to buy and sell without government control – well thanks for comming out of the closet Relugus, your collectivism is duely noted.

    But why not TRY freedom – get rid of the SEC and the Federal Reserve and let people (whether on Wall Street or anywhere else) buy and sell, lend and borrow as they choose?

    Of course fraud should still be illegal (but please note that even the most blatent frauds, such as that of Bernard M., are not noticed by the SEC – which just gives customers a false sense of security meaning they do not check things out themselves). And of course if someone lends out money that does not exist (via the various smoke and mirror games that the government declares “legal” even “the basis of modern banking) then they should be allowed to go bankrupt when the house of cards inevitablly comes down.

    If government did not “insure” deposits (as if one can “insure” against bad judgement) then I think you would find people were much more careful where they deposited their savings.